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Dáil Éireann debate -
Thursday, 7 Jul 2022

Vol. 1025 No. 2

Payment of Wages (Amendment) (Tips and Gratuities) Bill 2022 [Seanad]: Second Stage

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

I am pleased to introduce the Payment of Wages (Amendment) (Tips and Gratuities) Bill 2022 to the House. The Bill enjoys significant cross-party support. I acknowledge the contribution of Senators, whose thoughtful contributions have helped us refine and improve the Bill. I also acknowledge my colleague, the current Leader of the Seanad and former Minister for Employment Affairs and Social Protection, Senator Regina Doherty, who initiated this legislation. I also acknowledge Sinn Féin and Labour Party Oireachtas Members who produced Private Members' legislation on this matter. I further acknowledge the trade union movement, including Unite and SIPTU.

Until now, there has been no legislation which requires employers to pass on tips and gratuities received from customers to their employees. Tips and gratuities are a common feature in the hospitality sector and in some personal services. The vast majority of employers treat their staff fairly, and I acknowledge that. Unfortunately, there is evidence that some employers use tips as part of overall business income or use them to make up employees' contractual wages. That is not right.

This Bill makes some legislative changes to ensure there is fairness and transparency in the distribution of tips and gratuities in the sectors where these are common. The Government's position is that overly burdensome regulation in this space is not necessary but that certain objectives must be achieved through appropriate regulation.

The Bill passed through Second Stage in the Seanad in February. Following that debate, we refined elements of the policy relating to the treatment of mandatory service charges. The Bill before the Dáil today has been amended to respond to some of the issues raised by Senators.

This Bill has three objectives. First, it will prohibit employers from using tips and gratuities to make up contractual rates of pay. This ensures that tips and gratuities will be additional to a worker's contractual earnings. Second, employers will be legally obliged to distribute tips and gratuities paid in electronic form, such as by debit or credit card, to their workers. This is all the more important when fewer people are using or carrying cash. People often now leave tips in electronic form. The Bill requires that these tips and gratuities should be distributed in a fair and transparent manner. If there is a dispute, the Workplace Relations Commission can adjudicate on whether the approach taken by an employer is fair and transparent. Where money is not handled by the employer at all, such as is the case with regard to cash tips or some of the new applications people can use to leave a tip, this Bill will not interfere with arrangements that employees have made privately with one another.

The Bill will also require businesses to display clearly their policy on how tips, gratuities and mandatory charges are distributed.

This transparency is to the benefit of employees and customers. It will not prevent business owners from imposing other surcharges, for example, for group bookings, where often they have to hire additional staff at a premium. However, it will be clear that it cannot be described as a service charge unless it is treated as though it were a tip or gratuity.

Following amendments in the Seanad, employers will also be prohibited from describing mandatory charges as “service charges” unless they are treated in the same way as tips or gratuities, as I said earlier. This will provide clarity for customers on how certain charges are used. It is also important to stress that this does not interfere with the right of a business to impose mandatory charges on customers for additional services. However, if the charge is called a "service charge" or something similar, then the employer must pass it on to employees as though it were a tip or gratuity.

We have taken this approach to eliminate uncertainty for customers and staff as to what the purpose of service charges is. This is preferred over an outright ban on services charges in hospitality or other defined sectors. Banning mandatory charges outright could have adverse or unanticipated consequences for employees, employers and consumers.

A most important objective of the Bill is to provide a legal entitlement for workers to receive tips and gratuities paid in electronic form. These tips and gratuities should be paid out to workers in a fair and transparent manner. To ensure this, the employer will be required to provide a statement to workers showing the total amount of electronic tips obtained in a period and the portion paid to the individual employee for that period.

Employers will also be required to include in detail how cash tips are dealt with in their tips and gratuities policy. There will be no other regulation of cash tips because the Workplace Relations Commission, WRC, advises that it would not be workable. Cash tips are not accountable and may not be under the control of the employer. This means there is no clear evidential trail if there is a complaint.

In contrast, payment of tips and gratuities by electronic means is under the control of the employer and they can control how these tips and gratuities are distributed. The pandemic saw a large-scale movement away from cash, much of which has been sustained as we move to a more normal way of life. Payment of tips by electronic means is becoming the predominant way of tipping staff. The electronic record generated by this payment method will facilitate investigations by the WRC in the event of a complaint.

On redress, a WRC adjudication officer may take into account certain factors when determining whether tips were distributed fairly. These factors include the seniority or experience of the employee, the value of sales generated by the employee and the number of hours worked.

There will be no interference with schemes where tips are managed by employees themselves, for example, under a tronc system. These will continue to operate as they currently do. There will also be no change in the tax treatment of tips and gratuities.

The Bill provides for a review clause under the Act, which will be reviewed after one year in operation, when employers, employees and customers all have experience of how the legislation has worked in practice. Further changes and modifications to policy can be considered in light of that understanding.

There may be a minor cost to employers in complying with the new regime this Bill introduces. This includes having to prominently display a statutory notice of the employer's tips and gratuities and mandatory charges policy. However, information and guidance will be provided by my Department and the WRC to assist employers to develop their own policy and to help them identify the types of information and procedures that should be outlined and displayed in their policy. There will, of course, be engagement with the representatives of these sectors before final sign-off.

Most establishments already treat their employees fairly with regard to tips. For these businesses, the Bill will have little impact. They will simply have to display their policy clearly. However, other businesses will have to review how they operate and how they treat their employees. Their employees can have recourse to the WRC if they have a complaint.

For customers, the requirement for establishments to clearly show how tips are distributed and to whom they go will ensure transparency. It will provide reassurance that tips and gratuities left for staff will be distributed as the customer intended. This goes for whether you pay by cash or card. The requirement that the employer must provide a statement to employees showing the amount of electronic tips obtained in a period and the proportion paid to the individual employee for that particular period will ensure transparency for employees.

The Bill will further improve the rights and entitlements of workers. It builds on a set of legal rights that the Government is introducing to protect workers. These include the new annual public holiday, the Sick Leave Bill, which is currently making its way through the Houses, the transparent and predictable working conditions directive, the right to request remote working, the right to request flexible working, the living wage and, indeed, the move towards a national pension scheme, or auto-enrolment, so that all workers have an occupational pension to top up their State pension. I firmly believe that these improvements to workers' rights are essential to recruit and retain the staff that we need to drive our enterprise economy forward. I also believe they are essential in our efforts to build a more just society.

In conclusion, the Bill will improve the rights and entitlements of workers, largely in the hospitality industry where pay rates are often low, and it will provide welcome transparency and reassurance for customers. I commend the Bill to this House.

I am grateful for the opportunity to speak on this important Bill. Sinn Féin supports this Bill. That will not surprise anyone. Nevertheless, there are a small number of areas where we would like to see this Bill strengthened and I will reference them in my contribution, given that only 45 minutes have been scheduled for Committee and Remaining Stages next week. It is frustrating for me, as a legislator, as I have a number of amendments tabled that I think will help to strengthen the Bill. Many of them will not be reached because of the short time that has been allocated for the remaining Stages.

This Bill arose out of the bravery and hard work of workers and trade unions, and in particular, the One Galway movement, my own former trade union, SIPTU, Mandate and Unite. All of these campaigned tirelessly on this issue over many years. In particular, I want to give special thanks to the hard work and bravery of Julia Marciniak, who is now with Unite. She put her head right above the parapet and took on an unscrupulous employer for robbing tips from workers. She drove this issue home and put herself out there. In the industry she was working in, that is not an easy thing to do. I want to acknowledge that the Tánaiste met Ms Marciniak on a number of occasions and it is clear from this that he listened to her. It is fair that we commend her on her work on this and on her input into this very important legislation. She dragged a light and shone it purposefully on this whole industry. I also wish to mention that this Bill being on our agenda is due in no small part to the work of Sinn Féin's Senator Gavan.

In 2017, Sinn Féin presented a Bill on this issue alongside the trade union movement. That Bill subsequently passed all stages in the Seanad, despite opposition from the Tánaiste's own party, but more importantly, it kicked off a national conversation about tips and the importance of legislating for the protection of employee tips. Thankfully, Fine Gael's position changed. I commend the Tánaiste on bringing forward this Bill, engaging with the trade union movement on it and strengthening it in the Seanad to the benefit of workers.

The Bill does several important things. It places tips, gratuities and service charges outside of the scope of a person’s contractual wages, ensuring that tips cannot be used to top up a worker’s wage but rather, that they are in addition to a worker’s wages. Following pressure from Unite, SIPTU, Sinn Féin and others, the Government amended the Bill in the Seanad to have service charges treated the same as tips and gratuities. Prior to this change, service charges imposed by an employer could have been used to pay a worker’s wages or, indeed, just be kept by that employer. This was a significant win that will definitely benefit workers. I was delighted to see that this aspect was strengthened. I know this was done because there is an understanding of the importance of service charges to workers in the hospitality sector. As I said before, the Tánaiste engaged with the trade unions on this aspect of the Bill and in fairness, the changes that were brought forward will make a real and meaningful difference.

However, I have no doubt that, like me, the Tánaiste is concerned with public social media posts from the Restaurants Association of Ireland that state it intends to figure out a way around this part of the Bill that has been strengthened. Not long after the amendments were passed in the Seanad giving workers a right to a share of the service charges, the aforementioned association and some of its members posted comments saying that it is their "understanding that businesses are still permitted to apply a group booking charge as part of the new legislation". Essentially, what this looks like is that some businesses might intend to change the name of the charge from a "service charge" to a "group booking charge" to use this as a mechanism to circumvent this legislation. To be honest, I was not necessarily surprised when I saw this, but the immediate efforts of the sector to look straight away for ways to circumvent this new law tells us all we need to know.

What is more, it does a disservice to us as legislators, and to the Tánaiste as a Minister who is trying to create a fair law in respect of workers' rights in the context of tips, gratuities and service charges. Sinn Féin hopes the Tánaiste will bring forward amendments to ensure the legislation cannot be circumvented. We will work with him to do that.

We welcome the obligation on employers to display prominently to customers their policy on the distribution of cash and electronic tips. Additional provisions could be included, however, to make sure that every customer knows well what is the policy. It could be added to menus, posted in bathrooms or communicated in another way to customers. It is important that customers know where their tip, gratuity or service charge will go. There should be engagement with Fáilte Ireland with regard to ensuring that people travelling here know about this law. If I tip in a restaurant when I am abroad, I want to know that it goes directly to the intended person. I would find it reassuring, as would most people, to have that information front and centre. There may be a role for Fáilte Ireland in promoting and publicising that. It is also saying that this is a decent place and that if a customer leaves a tip, the worker gets that tip. That makes one's food taste better. I am not sure whether that is true, but it might work as part of a marketing campaign. Maybe the Tánaiste will take it on board.

Furthermore, there is a clear obligation on employers to distribute all electronic tips. Crucially, workers have a right to redress at the WRC, where issues arising in respect of tips, gratuities and service charges can be considered. However, there is no right to redress in respect of cash tips. That can be amended on Committee and Report Stages. I understand the Department believes it would be difficult for the WRC to adjudicate on that issue but, as a person who has experience in this area, I know that every case at the WRC is difficult and can be challenging to adjudicate on. That is not a reason not to do or consider this, however, and see if a mechanism can be found to address it. If the WRC is supported and resourced properly, it can have success with regard to cash tips. Let us not forget what we are discussing here. We are talking about the stealing of money. We have not done away with theft as a charge if a person robs money from someone else in the street, so we should not allow a worker's money to be robbed by an employer.

I commend the work of Dr. Deirdre Curran and Unite the Union on the treatment of workers in the hospitality sector. They have done a significant amount of research and studies into this sector and their work should be acknowledged. In considering the hospitality industry, it is valuable to hear from people who are engaged with workers on the ground and tell us what is really happening. In 2016, Sinn Féin carried out research on the treatment of tips for workers in the hospitality sector. That research indicated that one in three workers were not getting their tips. The research by Dr. Curran suggested that figure was one in four, while more recent research undertaken by Unite suggests the figure may be closer to 50%. It may be the case that half of workers who are tipped by a customer are having their tips robbed from them. This is why the Bill is so important. It is also why Sinn Féin wants to see penalties for contravening sections of the Bill increased to a class A fine of €5,000 from a class C fine of €2,500.

Contravention of sections of the Bill equates to employers, in effect, stealing from their workers. We have seen such instances uncovered time and again through WRC investigations. It is often labelled in the media as the recovery of unpaid wages, which is one way to spin it. It is not how I would describe it. This is money that has been stolen. In the past decade alone, €18 million in wages has been returned to workers following WRC investigations. The withholding of wages is particularly rampant in sectors where women and migrant workers make up a large or significant part of the workforce, such as the food and drink industry, the hospitality sector and retail. These are the same sectors where one would expect tips, gratuity and service charges to be left by customers for workers. It is clear, therefore, that we need strong protections and a strong and well-resourced WRC. Sinn Féin would like to see a rapid increase in the power of the WRC, including increases in staffing and funding, so that it can investigate workplaces and ensure that workers' rights are being respected and upheld. It is no surprise that the more funding the WRC gets, the more breaches of employment law it uncovers.

My final point is in the broader context of the industry. It follows on from the excellent contribution of my colleague, Senator Gavan, in the Seanad last week. In 2008, the joint labour committee system for the hospitality sector was struck down by employers. That was a significant blow to workers in the industry because the system did not just establish tiered rates of pay such that one could look forward to a career and career progression in the industry, it also dealt with issues such as paid breaks, overtime rates, Sunday premiums, holiday entitlements and sick leave. These were laws that protected low-paid labour. Many of them predated the foundation of the State. It was a significant blow to have those laws struck down by the High Court. The joint labour committee legislation was reintroduced in 2012 but for ten years now, employer groups in the hospitality sector have refused to engage with that process.

Despite the level of State support rightly given to the sector during the pandemic, they still refuse to engage in the joint labour committee process. The Government gave a range of supports to keep the hospitality sector going throughout the pandemic. I am not suggesting that this is somehow a transaction or that workers' rights can be bought from employers - they cannot because, as I always say, the price eventually gets too high. One has to consider the supports that were rightly given to the sector, however. Sinn Féin supported those measures and worked with the Government to ensure that the legislation got through quickly. The sector, however, does not participate in the joint labour committee process. We need to consider that. Indeed, it is fair to say that many of the recruitment and staffing issues the sector faces - we know of these issues because they are well amplified in the media - could be resolved by adhering to the joint labour committee process and ensuring workers have a career path, structure, paid breaks and all those things that need to be codified, have to be enforced and are part of that joint labour committee structure. These points are important in the context of ensuring people can make a decent living in the sector. Some 43% of low-paid workers work in hospitality, retail and wholesale. We need to ensure a better future for them so that people can look forward to a career in those sectors. That will not come about unless there is proper negotiation and engagement. That can happen as part of the joint labour committee structure.

I thank the Ceann Comhairle for the opportunity to speak on the Bill. I look forward to working with the Tánaiste on Committee and Remaining Stages of the Bill next week.

In the few minutes I have remaining, I wish to bring to the attention of the Tánaiste an issue that is coming to the fore within the hospitality sector, namely, the harassment of workers. The Tánaiste knows the sector and has engaged with some workers' representatives. He knows that those in the sector are, for the most part, low-paid workers. Many of them are migrants and many are women. They are vulnerable workers. The levels of harassment need to be examined. There is enough anecdotal evidence - the Tánaiste may be aware of it - to suggest there is a serious problem, as there often is where there is a massive power imbalance between the people at the top and those on the shop floor. The levels of harassment, including sexual harassment, within the sector deserve to be examined. I raise this issue because I unexpectedly have some time left in my slot. It is my intention to pursue the issue because it is a serious one. I very much look forward to working with the Tánaiste and the Department to ensure that we can stamp out harassment within the sector. What is happening is not on. This is a vulnerable group of workers. We are here discussing additional protections that are needed because they are a vulnerable group of workers. They are not just vulnerable in the context of tips theft or wages being robbed, they are also vulnerable in a host of other ways. We need to examine that.

I urge any person working in the hospitality sector who is not a member of a trade union to join a trade union. We know that collective action and people power work. We know that one's union is one's voice at work. It is a strong voice for the worker in his or her workplace. Any worker in the sector who is not yet a member of a trade union should find out where his or her union is, join it and get active in it.

I am delighted to have the opportunity to speak on the Bill. Like many others, I spent several years working in the hospitality sector. I understand how poorly paid are those working in the sector, how challenging a job it is and how important tips are to staff right across the hospitality sector. My party and I support the Bill. It is important. There has been a long campaign on this matter. It is great to see it advancing through the various Stages.

I commend the constant effort of hospitality staff.

From personal experience, I know that when you work in the hospitality sector, you are drained at the end of each day. It is extremely tiring work. The last thing you want to do is get involved in a campaign. The fact that they are committed and working to make changes is a credit to them. It is also a credit to the trade union movement, which has been extremely active during this campaign. As Deputy O'Reilly said, the One Galway movement has also led the way. SIPTU, Mandate and Unite the Union have all campaigned tirelessly on this issue for many years. My colleague, Senator Gavan, has been a constant voice in support of workers in the hospitality sector for a long time. He highlighted the issue of tips being withheld by employers. In 2017 he introduced the National Minimum Wage (Protection of Employee Tips) Bill 2017. Unfortunately, that was blocked by the previous Fine Gael-led Government, which made it the subject of a money message.

A high number of workers in the hospitality sector frequently see their hard-earned tips being withheld by employers. We have seen from research that one in three workers do not receive the tips that they earn. The change in stance by Fine Gael is very welcome. I commend the Tánaiste, whose engagement in the process relating to this issue has been very important in resolving it and ensuring that the Bill was brought forward. It is important to acknowledge his contribution. Amid the cost-of-living crisis where so many low- and middle- income workers are struggling from week to week, it is hard to see their tips being withheld and gratuities taken from them by employers. As Deputy O'Reilly said, people want to see staff getting the tips they leave for them. They pay the staff who have been serving them during the night and delivering excellent service, and they want the tips they leave to go to those staff.

Ireland has one of the highest rates of low pay in the developed world, with 20% of our workers in low-paid jobs and 50% of women currently earning €20,000 a year or less. A high proportion of those employed in the hospitality sector are low-income workers, and their tips and gratuities can make or break their week. The withholding of tips and wages is especially rampant in the food and drink and hospitality sector, in which large numbers of women and migrant workers are employed. In the context of these sectors, you would expect tips, gratuities and service charges left by customers for workers to end up in workers' pockets. Little do the majority of tipping customers realise the extent of the practice of withholding of tips, gratuities and service charges by employers. Employers pocketing tips and gratuities meant for workers must be treated as what it is, namely, an unfair practice. In many ways, it is about power. It is the power of employers to impose whatever measures they want on staff. It is up to the State and the Government to ensure that this legislation is delivered.

We need the penalty for wages withheld by employers to be increased to a class A fine of €5,000 and not the proposed class C fine of €2,500. Over the past ten years, almost €18 million in withheld wages has been returned to workers after investigation by the WRC. While legislation to protect employees’ tips will have a profound impact on workers in the hospitality sector, we must also acknowledge that workers should not be dependent on tips in order to live. Workers need to be paid a living wage. Relying on tips to survive is the result of what has happened in the context of a sector in which low pay, precarious employment and poor working conditions have been normalised. We need to see the hospitality sector engage with trade unions and work to re-establish the joint labour committee.

Many of the recruitment and staffing issues the hospitality sector faces could be resolved by an effective joint labour committee. Without a system involving tiered rates of pay, overtime rates, Sunday premiums, holiday entitlements and sick pay, the sector will continue to face many of the same issues it faces at present.

I welcome the Bill, which the Labour Party will be supporting. I thank the Tánaiste for his work in respect of it. As has been said, people often take trade unionism for granted or do not understand the nature of it and what it achieves. People's interaction with trade unionism, if they are familiar with it, often involves their seeing images of picket lines, protests or placards. However, what trade unionism does all the time is work to improve the conditions of workers. It works with the Government, Departments and individual Ministers, it gets legislation over the line and it improves the lot of the workforce. That is why unions are so important. As has been said, that is why people need to be members of unions. It is not always about disputes, although disputes will happen in any walk of life. It is about spotting a problem, seeing a resolution, working with fair-minded people in government who are willing to work with trade unions in getting something over the line. In fairness to the Tánaiste, he has worked in a fair-minded way on this issue and has brought forward this legislation. That is to his credit.

It is slightly depressing that legislation such as this is deemed necessary. You would have thought that if an industry dealt with its workers fairly, a tip allocated to a worker would remain in that worker’s possession. Unfortunately, however, we cannot have that level of trust with certain industries. That is why we need legislation in this regard. We have to reflect on the hospitality industry in Ireland. It is important that we restate this. The level of vulnerability of workers in this industry and the level of low pay, as has been outlined, are quite stark. Some 23% of Irish workers are on low pay by OECD standards. We have the third highest proportion of low-paid workers in the OECD. That is something which shames us. A very high proportion of those workers are in the hospitality sector. They are disproportionately migrants and women.

It is not just the cost-of-living crisis that should make us reflect on how difficult it is to be in low-paid employment. That is a constant struggle. Also there are vulnerabilities around the security of that employment, and, certainly, the number of the workers in question who are unionised can be lower than in other sectors. That is the very reason why legislation such as that before us is necessary.

The Labour Party congratulates the One Galway movement, the One Cork movement and Senator Gavan who brought forward legislation on this matter in the Seanad.

The hospitality industry always seems to be at the forefront of advocating for lower wages, for the breaking of sectoral pay agreements, for the disbandment of joint labour committees or whatever. The industry appears to be resistant to change and is unmoved by the reality of the workers who keep their businesses afloat being paid so poorly and being so poorly treated. The industry is held together by low-paid workers and by those who are particularly vulnerable.

While we absolutely welcome the Bill, we need to have a wider discussion about stronger collective bargaining rights for workers. We need to have a scenario where not just the workers have the right to join unions but where there is a requirement on employers to engage with those unions. It is no accident that the weakness of collective bargaining legislation in Ireland is a direct correlation to the numbers of people who are on low pay. If you are a member of a union and if you work in a unionised profession, the productivity and pay relating to that profession are better and everybody is enhanced by being involved in the relevant industry.

However, when one has an industry which seems to be built on profit-making from the hard labour, insecurity and low pay of vulnerable sections of society working in that industry, then that has to be challenged.

The Labour Party, and our spokesperson, Senator Marie Sherlock, welcome this legislation. It reflects well on the Government. It reflects well on the Department in which the Minister of State, Deputy English, works. We look forward to the next Stages of the Bill next week.

The Minister of State will accept that we make this argument on this side of the House regularly. We have a problem with low pay in Ireland. We are a low-pay economy. We stand out as a matter of shame in Europe on the rates of low pay. It affects women disproportionately. It affects migrants disproportionately. It, obviously, has a knock-on effect in terms of accommodation and other levels of insecurity in life, such as mental health stresses. It is particularly profound in the hospitality industry. The industry has a great capacity to go on the airwaves and talk about poverty and how difficult it is. Many of the concerns are valid but if we were to challenge them properly, the rates of pay in the industry are partly the reason it cannot attract and keep staff. When it comes down to it, it will have to wise up and not stand over - we cannot stand over as a legislative body - the practices within that industry anymore.

While we appreciate this Bill, this has to be one small brick in the wall of defence that the worker needs to have in advocating for himself or herself. We need to have a unionised workforce in the hospitality industry. Legislation from these Houses needs to protect that workforce so that it has proper engagement with employment, its payments can be enhanced and protected over a period of time, and security within that work can be enhanced and protected over a period of time, and that within their union, people have a department that will consistently work with them to improve their lot. I look forward to further debate next week.

The Government will have a fair amount of agreement across this House on the absolute necessity of this legislation. It is difficult to think that anybody will get up and speak against it in the sense that what we are dealing with, as Deputy O'Reilly put well, is a situation whereby employers are robbing the wages of workers. That is abhorrent to most, if not all, right-thinking people. It is absolutely necessary that we have legislation that protects and ensures that does not happen.

I will add my voice, as many others have, to the Trojan work that has been done by many people who have worked in this industry, and particularly to the unions, the One Galway movement, SIPTU, Unite and Mandate, and the work of my colleague, Senator Gavan, in ensuring that this was put top of the agenda and that we are in this position.

Many have spoken already about the fact that we are coming to the end of the Dáil session, we are dealing with a great deal of legislation and there is not necessarily the time we would like to deal with the amendments. It is fair to say there may be a number of gaps in this legislation and we need to ensure that those gaps are plugged because this is about protecting workers. We are talking about workers who are absolutely necessary to the economy. If we are talking about hospitality and the absolute importance of it to tourism and other sectors, we all will be aware of the difficulties being talked about within the industry in not being able to fill particular positions but a priority would be ensuring that the rights that workers have within this sector are guaranteed. We all will be aware of the difficulty and the lack of engagement by employers in relation to the joint labour committee, JLC, framework. We need to see that all those pieces are put together and that people have their rights in relation to overtime, paid breaks and all those other pieces that we all take as an absolute requirement.

We welcome the fact the WRC will be able to deal with disputes in relation to breaches of this legislation. People should share electronic payments and we need to ensure we do this for cash payments because there is still a considerable number of people who would use cash to pay tips.

We welcome the fact that policies will have to be displayed and people will know, but we need to ensure that is absolutely enshrined. We need to ensure that if there are added bits, we all know exactly what is happening. We do not mind going into a restaurant and paying. I quite like the idea, as many people do, of tipping but that is where I am assured that the tip goes to the person who is putting the work in.

There is still a considerable amount of work to do in relation to collective bargaining and other workers' rights, but this is a piece of work we can do. We need to make sure we do not leave any gaps.

Like others, I will be supporting this Bill and its progress. Probably, the only surprising aspect is that workers require this kind of protection. Most people would have assumed that when a tip is given, the tip goes to the worker.

One in five workers in the State is classed as low paid, that is, approximately 370,000 people. Ireland's rate of low pay is significantly above the EU average, ranking eighth out of 27. Among other high income countries in the EU, we have the second highest rate of low pay. This is not a new problem. For the past 20 years, the rate of low pay has remained consistently at approximately 20%. This is a major structural issue which affects every aspect of our society. Low pay has negative physical and mental health impacts on the health of workers. It absolutely undermines their quality of life. The economy suffers from the lack of purchasing power of low-paid workers. Public finances and, therefore, public services are weakened by the low levels of revenue taken in by way of taxation.

Low pay is feeding into homelessness and inadequate housing for working people and their families. Many low-paid workers cannot keep up with rising rents and cannot qualify for mortgages due to the increasing gap between their incomes and house prices, which are very considerable.

Low pay is not only absolutely irrational on a broad economic level; it is morally bankrupt. The Government likes to brag about the low unemployment figures in Ireland in comparison to other EU states and to proudly show off statistics that say we have the highest rate of youth employment in the EU, but one must ask how much they are being paid.

The hospitality and tourism industry has one of the youngest workforces. It is predominantly made up of women, and between 33% and 40% of workers in the industry are migrants. According to a recent study by Fáilte Ireland, 68% of them are being paid less than the living wage. Is it any wonder that more than 40% of the sector's workers did not return to their jobs post pandemic? There is a problem with recruiting. People are looking at it rationally, in terms of the cost of living and their earning power.

For many people in the service industry, tips make up the difference. The level of tips received can dictate whether there is enough money in the bank to put food on the table, pay the bills and live any kind of dignified life in such an expensive country.

In light of that, I welcome much of this Bill. Placing tips and gratuities outside the scope of worker's wages is a very important step forward. When anyone leaves a tip, it is done with the implicit understanding that it will go to the person who has provided the service, and that it is an added bonus to the person's wages and an appreciation of his or her work on behalf of the person who receives the service.

No one who leaves a tip expects or wants it to be taken by the employer. It is up to every business in the service industry to calculate its profit in its pricing. It cannot be left to the customer to provide extra money voluntarily to make up the basic business costs of the establishment.

It is good to have legislation clearly setting out that tips taken electronically must be distributed to the staff. Especially after Covid, this has become much more common and it is likely to become the dominant method of tipping, if it is not already. It has been very unclear in recent months where those tips are going. I have heard from many people that they have developed a habit of asking staff directly whether they receive the electronic tips before giving them. Some people carry cash so that they can have a higher degree of certainty about that.

In other establishments, I have noticed staff automatically clicking "No" to electronic tips before handing the card machine over, because they know they will not receive them. That tells us something about the way people feel about the issue. It is theft. If people leave a tip, they want to be sure that the person serving them gets the tip. A crucial and welcome aspect of this Bill is a right to redress for employees who do not receive electronic tips, which will be through the WRC. However, this does not seem to be the case in respect of cash payments. I understand the Department was advised by the WRC that ensuring cash tips go to workers would be unenforceable, but I feel some action must be taken. This Bill makes great improvements to the situation in the sector around tips and optional service charges, but cash tips are a major avenue for people to earn an essential increase on their low salary.

When it comes to the obligation for employers to display their policy of distributing tips among staff, it is absolutely crucial that the tips and gratuities notice is easy to find and is available to customers both before booking and before paying. Such notices must be properly signposted and not hidden behind a plant where people do not see them but with employers fulfilling their obligations under the law. We must be quite specific about that. It is important to ensure the notices are prominently displayed. The regulations need to be very clear about defining the concept of "prominently displayed" and, critically, it needs to be enforced. That goes without saying. I am not sure who would do the enforcing. The Minister of State might come back on that point.

The language in the Bill dictates that an employer must consult workers if he or she plans on making any changes to the distribution of tips. Consultation is not enough. It really is their money. It is fundamentally not the employer's income, so it should be up to the workers to determine how they split their tips. Any changes should be done with the consensus of employees.

Service charges are the area in which I believe the Bill is weakest. Under the current legislation, any business can implement a service charge - mandatory or voluntary - and take it as revenue. Most customers do not realise this. It seems fairly straightforward that the service change would go to the workers who are providing the service. We most often see such a service charge when booking for groups. Many people wrongly assume that the charge functions as a kind of built-in tip for the worker as a consequence of being responsible for a large table. I assumed that as well, wrongly so.

The Ivy restaurant was at the centre of a campaign and national conversation about tip theft, spearheaded by Unite's Julia - I always pronounce this name wrong.

I thank Deputy Collins. Yes. I met her. She spoke at a May Day conference that we held just a few months ago. She was very impressive. It is easy to sit on the other side when you win, but she told us about the toll it took on her to get to the point where they did win on that and how nothing much has changed for other people she knows, who she is trying to organise within the industry. It is really important to listen to people like her because it shows just how vulnerable workers in that industry are.

At its appearance before the Labour Court, The Ivy admitted that it had introduced a mandatory service charge on every table, which negatively impacted on the amount of tips left for workers. Because, of course, when you assume a service charge goes to service workers, then you are very unlikely to leave an additional tip or perhaps not as much. Therefore, it is concerning that this Bill allows mandatory charges to be taken by an employer and used as general income of the business as long as they are no longer called service charges. As mentioned by Deputy O'Reilly earlier in the debate, several members of the Restaurants Association have already identified this as a loophole and it is something that has been discussed on social media. For poor employers who are already stealing the tips or service charges of their employees, despite the very clear moral issue, this gives them an avenue to continue the practice with a more consistent income. It is important that we identify the loopholes.

Mandatory charges result in higher bills for the customer, which are not easily calculated by just looking at the individual pricing on a menu. It significantly reduces the chances of customers leaving tips for workers. I understand that the Tánaiste listened to the concerns and introduced an amendment to exclude mandatory service charges from making up any portion of the basic wages of staff. However, could he outline why it stopped at mandatory service charges? Why is it that mandatory group booking charges, for example, can be included? Again, it is down to the loopholes. It is incredibly important to bring transparency into the processing of tips and gratuities in the service industry.

Unite's general secretary, Sharon Graham, has said:

Where tips policy is unclear it usually means it is also unfair, and it hits this workforce hard in the wallet. We estimate that hospitality staff lose thousands a year in lost earnings when their tips go elsewhere.

Of course, low pay and tip theft is only one of the issues facing workers in the service industry. A Fáilte Ireland survey found that many staff complained of not getting proper work breaks, having their hours changed at the last minute, and approximately 33% did not receive any extra payment for working on bank holiday weekends.

It is a difficult and insecure sector to work in. Given the make-up of its workers, short-term contracts, language barriers and low trade union density, the workers are very vulnerable to abuse. Globally, low trade union density runs parallel to inequality. Where workers have little or no collective bargaining power and have very little awareness of their basic workers' rights they are often open to exploitation. A right to collective bargaining is essential.

When we look at social democratic Nordic countries such as Sweden and Denmark, they do not have a minimum wage, yet the average rate of low pay in those countries is approximately 8% compared to 20% here. They do not need a minimum wage because they have collective bargaining. More than 80% of employees are covered by collective bargaining agreements, compared to approximately 33% in Ireland. Crucially, in Ireland, the sectors with the lowest traditional pay have the lowest density of trade union membership. I acknowledge that the fair distribution of tips will help people a lot, but if we are serious about ending the scourge of low pay in this country then we need to introduce a right to collective bargaining.

One of the stories in the media in recent months is some of the charges that are being levied in terms of room rates in some hotels. I looked at some of them myself. They are astronomical. The sector is price gouging. It does no service to it. Low pay predominates in the sector and its workforce is very vulnerable. When we consider the post-crash situation and the importance of non-domestic tourism in terms of the recovery, we are doing ourselves no service by having a situation whereby there would not be a secure employment base for the sector.

That secure base will not be achieved unless there are attractive rates of pay and certainly rates above the poverty line. Where there is activity like price gouging, it does not do anybody any favours in the longer run. The totality of these issues must be considered and there must be engagement with organisations like the Irish Hotels Federation in this regard. Of course, there are people who are running their hotels and restaurants fairly and diligently but the cohort of those who are not are doing everyone a disservice.

I thank the Tánaiste for introducing this legislation, which provides legal protection for workers in respect of tips and gratuities. It will mean any tips received cannot be counted towards an employee's basic pay; they must be counted as additional and separate.

The treatment of tips and gratuities has been a long-standing issue that is regularly raised by employees and trade unions. Historically, all good employers left it to workers to make their own arrangements around tips. However, with the advent of card payments, particularly contactless payments during the Covid-19 pandemic, employers and management became involved in processing these payments. In some cases, the distribution of electronic tips was facilitated but in many establishments, tips paid by card could not be processed. There are also reports of tips and gratuities being included as part of basic wages by some unscrupulous employers, as referred to earlier.

The aim of this Bill is to provide clarity on the meaning of tips, gratuities and service charges, to place tips and gratuities, but not service charges, outside the scope of a person's contractual wages, to oblige employers to display prominently their policy on the distribution of both cash and card payments and to oblige employers to distribute fairly, equitably and in a transparent manner tips that are received in an electronic form, that is, through debit or credit card payments or by way of smartphones. This will provide a legal basis and certainty for employees in respect of tips. It will also provide certainty to the public. When paying for a meal, especially when paying by card or smartphone, many people are unaware of how, or whether, tips and service charges are distributed among staff. Once this law is enacted, all employers will be required to show clearly how tips and service charges are dealt with in their businesses. This will provide clarity for both customers and staff.

Most establishments already treat their employees fairly with regard to tips. For them, these provisions will mean no change beyond having to display their policy clearly, which is extremely welcome. People working in hospitality and other service sectors have made tremendous efforts during the pandemic to keep services going. In many cases, they did so at some risk to themselves and, indeed, their families. This Bill will provide legal protections in respect of tips and gratuities and it is very welcome. I thank the Tánaiste and his officials for introducing it.

I welcome this Bill, which will finally see protection in place for employees in regard to tips. It will ensure those tips make their way into workers' pockets, regardless of the actions of bad employers. It is sad that we need legislation in this area. It is important to point out that most employers treat their employees well, but it is a reality that there are employers who use any opportunity to exploit their workers for financial gain.

I commend my Sinn Féin colleague, Senator Gavan, on his work in this area and on pushing the issue forward even when Fine Gael, when it was in government in the previous Dáil, was resistant to it. I welcome that the party has finally seen sense and made a positive move to regulate the area of tips. I congratulate all the people involved in pushing for this legislation, including those in the trade union movement who put in years of campaigning on this issue. They have been great advocates for those they represent. I hope this is the first move in the direction of proper protections for workers who may be exploited, particularly within the hospitality and tourism sectors. We know those sectors have an issue with tips not finding their way into employees' pockets. A range of research has demonstrated that anywhere between 30% and 50% of employees are not getting their tips. These figures are shocking when one considers the number of people who are in jobs in which they may get a tip.

This Bill makes a number of important provisions. It will prevent the practice of tips being used to top up employees' wages, which we all agree is very welcome. It places an obligation on employers to make their tip policy clear to customers in order that the latter know exactly who is getting any tip they give. This will give peace of mind to people who are unsure about tipping electronically. As proposed in Senator Gavan's legislation, this Bill will establish a right of redress for employees, as well as taking on the Senator's suggestion that service charges be treated the same as tips. The Government has taken on Opposition parties' suggestions and I hope that continues as we work together to improve the Bill further.

I welcome the opportunity to discuss this Bill, which is part of a major suite of changes we need to undertake. There is no doubt that we are living at a time of extraordinary transition in the way our economy works. We are in the aftermath of a financial crisis that shook people's faith in the regulators that had responsibility for keeping us safe financially. We have passed through the Covid period, which rocked to the core many of our assumptions about how we can protect ourselves. We are now in the midst of a digital and data revolution that is transforming the way enterprises operate and business is done.

It is really important that we recalibrate some of the rights and responsibilities of enterprise in this period of extraordinary change. I see this measure, along with many of the other measures the Tánaiste and the Minister of State, Deputy English, are seeking to promote as part of this recalibration of what we expect from a modern, responsible enterprise. It is really significant that we have introduced legislation on sick pay, which was a major gap in employee protections exposed by the Covid crisis. Legislation is being worked on to deliver a right to request remote working. Today, the Joint Committee on Enterprise, Trade and Employment, of which I am a member, published its response to the proposals put forward by the Government in this regard. It is fair to say we would like the Government to be more ambitious in the development of those rights. We are also seeing the development of the concept of a living wage, which recognises that many aspects of precarious living have been thrown up by the new digital models that are changing our world.

There are some who would seek to stop open trading relationships and the open economy approach that has been so valuable to Ireland in its development over my time in the Dáil. Those who take that view see imbalances in the way some of that economy model has worked. We have seen those imbalances acutely, not only in terms of how employees are impacted but also in how our environment is treated. We must come to a position whereby new responsibilities are articulated by the Government in respect of data, consumer protection, sustainability and the adoption of circular models, and flexibility in regard to working relationships. I see this Bill as part of the suite of measures we need to undertake, recognising that people in vulnerable working situations can often be abused if what customers think in good faith is a payment they are giving for the benefit of workers is instead being pocketed by others. The new regulatory obligation that is coming in the direction of enterprise under these proposals will be described as a burden by some. In my view, however, it is the means by which we can protect the sort of business model that has been so important to a small, open trading economy like ours.

The Minister of State has done more than many in this House to strike the balance we need between small enterprises struggling to keep their heads above water and to keep a complex set of relationships going, and, at the same time, the need to transform and to take on the greater public responsibilities that enterprises have to internalise. I wish the Minister of State well.

One of the most significant initiatives I have seen in this Dáil is a growing impetus from the Department of Enterprise, Trade and Employment to recognise this new direction of travel. I urge that consideration be given to concepts such as the circular economy, which I believe are truly transformative. At the heart of the circular economy is how we can take environmental damage out of the way in which we live our lives, just as we are seeking in this Bill to take some of the social damage out of the way we live our lives. I urge the Minister of State, the senior Minister and the staff of the Department to continue to also develop new ways of ensuring, as we strive in respect of enterprise and success, that we do not undermine our environment, the rights of our consumers or the rights of our employees and that we promote upskilling, flexibility in the workplace and gender equality, an aspect we will debate later. These are the values that must be at the heart of a modern, high-performing enterprise and this is what we seek to strive to achieve with this Bill.

We must of course try to strike a balance between the pressures on the day-to-day activities of enterprises, but the Minister of State has performed extraordinarily well in this regard. He has been willing to sit down and talk to people and to talk through the requirements. This legislation is a good approach. It embodies fairness. It is not overly prescriptive. It relies on display notices and on the power of enforcement. This is the right balance to strike. It also has, ultimately, the teeth to enforce its provisions to ensure these requirements cannot be ignored. I wish the Minister of State well in his work. I am thankful to have had the opportunity to speak on this important Bill.

I thank my colleague, an Seanadóir Gavan, for his work in forcing this Bill onto the agenda. In 2017, Sinn Féin brought forward a Bill on this issue that was supported by the trade union movement. That Bill passed all Stages in the Seanad despite the opposition of Fine Gael and it was influential in driving the conversation about tips and the importance of legislating for the protection of employee tips. Following pressure from Sinn Féin, Unite the Union and others, the Government amended the Bill in the Seanad to have service charges treated as the same as tips and gratuities. Prior to this change, service charges imposed by employers could have been used to pay workers’ wages. This is a significant win that will benefit workers.

This Bill puts tips, gratuities and service charges outside the scope of workers' contracted wages, ensuring that tips cannot be used to top up workers’ wages, but rather that they will be in addition to workers’ wages. Sinn Féin supports this Bill, but there are several areas where we would like to see it strengthened. We want to see the penalties for contravening sections of the Bill increased to a class A fine of €5,000 instead of a class C fine of €2,500. Contraventions of sections of the Bill equate to employers robbing money from their workers. In the last decade, nearly €18 million in stolen wages has been returned to workers after investigations by the WRC. Employers also have an obligation to display prominently policies on the distribution of cash and electronic tips. This is welcome, but additional provisions could be added to ensure that every customer knows the policy.

As a former shop steward, I recommend that all workers join a trade union. Campaigning unions, like Unite and Mandate, have been to the fore of social change, along with furthering the rights of workers. There has never been a more important time for unions. We saw during Covid-19 that workers had been exploited and this situation needs to change. Insecure contracts and poor pay and conditions, along with the need for a living wage, have all been highlighted as issues that need to be addressed. Studies have shown that workers in unions are better paid than those in comparative non-union jobs. Workers’ rights have been under attack for many years and were dealt a serious blow with the passing of the Industrial Relations Act 1990. It is time that workers’ rights were prioritised, and Sinn Féin has demonstrated time and time again that we are on the side of workers. We need an election so that people can pass judgment on this Government’s miserable record on workers’ rights. When workers’ rights are under attack, we will stand up and fight back.

I compliment the Minister of State on taking the initiative and bringing this Bill before the House. I also acknowledge his capable and competent stewardship of his Department and his willingness to meet various representative groups and to listen to their advice and requests. This Bill offers fairness and prioritises equality for ordinary workers in businesses. This is a positive and welcome acknowledgement of the major role that employees play in keeping businesses afloat. This legislation does that. It has the potential to increase the payments that employees receive in businesses, such as in the services and hospitality sector. It will also increase their incentive to excel and their determination to provide the best possible service to businesses' clients and customers. News about this Bill is not a banner headline. All too often, the media favour more sensational stories but this is, in fact, a good news story and one that has been sought from the industry for a long time.

This legislation is going to provide bigger earnings for employees and service providers across the country. It also puts right a wrong that has long existed, which most people seldom, if ever, thought about. When most of us go out for a meal, attend the barber or hairdresser, travel by taxi, have luggage carried to a hotel room or have groceries carried to a car, we feel that giving a tip to the person who helped us is the right and proper thing to do. It is a way of saying "Thank you" to the person who has helped us by providing a service for us. It is also good manners and common decency.

Let us take the situation of a porter carrying our bags to a hotel room. We may hand him or her a couple of euro for the effort and we are grateful for having received that help. Yet when we checked into the hotel, we did not give any tip to the hotel receptionist who has also provided us with a service. Was he or she less helpful? No. We could not have checked into the hotel without that assistance. At the end of the week, the porter could have earned a nice amount of extra money, whereas the receptionist would still just be paid the usual wage. This scenario is just a simple and over-simplistic example of how the payment of tips is unbalanced and inequitable. It serves to show how some staff benefit while others are overlooked.

The situation becomes more complicated and confusing when people go out for a meal. The waiter or waitress looks after them throughout the meal, brings them what they ordered and gets them anything they want to ensure that they enjoy their dining experience. The customer is satisfied, the meal was perfect, delivered promptly and nothing was overlooked. Those people look at their bill and they are happy to note that a service charge has been included. They feel they have been provided with a top-class service and have no problem paying the charge in the belief that they are giving a little extra tip to the staff member who helped them. The vast majority of us believe that the service charge is another word for a tip. It stands to reason, in most people’s minds, that the charge is being made for the service that has been received.

Some people who have been less than happy with the service they have received have refused to pay this charge, in the same way as they would refuse to leave a tip. They do so with the honest conviction that their waiter or waitress did not deliver a service worthy of additional payment. Most people never query a service charge, pay it willingly as part of their bill and do not question where the money goes. What people do not realise is that this service charge is not a tip. In most cases, the money received through the service charge goes towards paying the staff their basic wages. There is nothing wrong with this.

In fact, it helps to ensure that staff wages and other costs can be covered. However, it is not an additional "Thank you" for the service a customer received from an individual employee. It is used to fund the overall running of the establishment. The Bill will end this misunderstanding. The owner of a business will be able to include a service charge in bills because, after all, running a business is a highly competitive and costly exercise. There will no longer be any misinterpretation or misunderstanding of what the service charge is used for by the business. Clients and customers will be left in no doubt as to what their money is being used to cover.

Tips, on the other hand, will be a guaranteed additional boost to staff members. As most customers or clients of a business now pay through electronic transactions, employers will be obliged to ensure money that enters their account in the form of tips will be distributed equally and fairly to employees. Cash tips will also be distributed equally among staff, which is to be welcomed. If a customer decides to leave an enormous tip following a meal or provision of a service, all employees will benefit, not just the front-of-house staff. All of those who made the customer happy through their work behind the scenes will be looked after. This will create a fairer system across the board. In addition, employers will be legally obliged to display a notice on their premises that clearly states how they distribute any tips received by employees. This will ensure fairness for all employees and protect individual interests under the new legislation.

One of the most beneficial aspects of the Bill is that the distribution of tips will not impact on employees' contractual wage. They will receive their wage as usual with tips being an additional bonus. As the vast majority of people in the service industry, particularly in the hospitality sector, earn the minimum wage, the Bill will help to make taking up employment in this sector more appealing. The hospitality industry as a whole has been seriously struggling to hire and retain staff particularly since the ravages it experienced due to the restrictions during the Covid pandemic. The ability to increase their minimum wage by earning additional money through tips will hopefully tempt more people to return to or take a closer look at working in the hospitality sector. The system will also encourage employees to provide an even better service to customers with the aim of earning a larger tip. It will act as an incentive to deliver greater customer care that will in turn help to attract more clients or customers of the business.

The Bill has the capacity to improve payments to staff, allow businesses to continue to provide for the costs of running their operations, and enhance the experience of the customer or client. It may not be headline grabbing but it is worthy and welcome legislation, and I am happy to support it.

Before I was elected, there was a protest outside a restaurant a few hundred metres away from Leinster House. On a dark evening, workers came together to demand fairness and transparency when it came to their hard-earned tips. Since then, the hospitality industry has been through the wringer, enduring lockdown closures, shorter opening hours, and adapting to make even the unimaginable work - outdoor dining in December. The Government supported the industry and those workers the whole way through. Why? Because we know our hospitality sector is one of the most critical industries on the island and we value everyone who works in it. This support and the support of all of the schemes and grants worked. In September of last year, IBEC predicted 40,000 fewer jobs in the drinks and hospitality industry, but since then we have seen a dramatic recovery in the sector. Now we have the unforeseen challenge whereby pubs and restaurants cannot get enough staff.

During the pre-pandemic protest held just down the road from Leinster House, I remember that waiters and waitresses chanted "Cook your steak. Eat your chips. Give your staff their well-earned tips." Those chants will soon become law and could well bolster the attractiveness of careers and part-time jobs in the industry. When any of us sit down in a restaurant, hotel, or bar, we should know that our tips go to the people who serve us, help cook our food and make sure we have a good customer experience. That should happen regardless of whether we pay by cash, card or app.

Senator Regina Doherty provided great leadership on this issue when she was the Minister for Employment Affairs and Social Protection. I am pleased that the Minister of State and an Tánaiste built on that work to bring in this welcome law. It will make changes to the Payment of Wages Act so that tips can no longer be used to supplement pay. No one in this country should be earning below minimum wage. Establishments that use tips to make up minimum wages are operating dishonestly and duplicitously and doing a disservice to all of their servers, but not anymore. The Bill will also bring in a requirement that all establishments will have to display their tips policy publicly. That means fairness for workers and transparency for customers.

I have been both a worker and customer in the industry as I am sure many Members have been. Like so many, my first job was in my local pub. Having to work for tips that I earned helped me to come out of my shell, gain confidence and develop social skills as a teenager. Taking that opportunity and hard-earned cash away from students, waiters, waitresses and lounge people is just unfair. I am pleased that the Bill stands up for those workers who serve people as well as those working in kitchens.

We used to hear the phrase "Cash is king" a lot, but not so much anymore. Today, we are living in a "tap world" where everything can be paid for at the tap of a card, phone or even watch. For today's young people, virtual cash is king and that is why the Bill is so important. It will ensure that all tips come under the remit of the legislation, including those made through tapping. Many of us will be familiar with food delivery apps, such as Deliveroo or Just Eat, many of which offer the opportunity to leave a tip through the app, which can be handy if a person does not have cash and was a welcome development during the pandemic.

I appreciate my colleague, Deputy Higgins' generosity in sharing time. I apologise to the House for missing a previous speaking slot.

I rise very much to support the Bill, which is good not only for workers and customers but, crucially, employers also. As mentioned by, I imagine, every Deputy in the House, there is an acute shortage of staff in all sectors, particularly in the hospitality sector. We need to make sure it is a sector that has lucrative and rewarding career prospects for all employees.

The Bill is not just about the hospitality sector. It is about so many more sectors. The idea of a tipping culture is to ensure that it is successful. I concur with all the points raised by my colleague, Deputy Higgins, about the importance of this Bill, particularly as we move further away from being a society that relies on cash. The day of having a couple of euro or fiver in one's pocket is simply gone as we rely on apps and tapping, as the Deputy explained.

I raise an issue which I ask the Minister of State to take back to his colleagues in government, not just the Tánaiste but crucially the Minister for Finance, Deputy Donohoe. I do not believe the Bill goes far enough. There is an opportunity as we make preparations for the budget in September to look at the example of what our nearest EU neighbours in France have done in this area. They introduced legislation whereby all tips for those working in cafés, hotels, bars and restaurants are now tax exempt. This is a budgetary consideration and has been working successfully in France for more than a year. We in this jurisdiction are not alone in having a staff shortage in the hospitality industry. It is impacting every country in the European Union and we have seen leadership from the country that has consistently valued the hospitality sector more so than many other EU member states. This would be a way to ensure that the hospitality sector has long-term career prospects wherein staff can maximise their return not just of salary but of tips. There would be no loss to the Exchequer because the number of tips that are taxed is minimal. This would, therefore, regularise the practice and allow people to give, to the full extent of their generosity, to the person serving them, be it the barman, waitress, or server in the background. It would also, no doubt, improve our already famous Irish customer service reputation around the world. It is one of the many reasons so many people enjoy coming here on holidays and why Irish people enjoy eating out.

This was something I pushed for before the last budget and I was very disappointed by the Minister's response, particularly in light of where we were at the time with the acute impact Covid restrictions had on the hospitality sector and the lengths to which hospitality owners and those working in the industry went in accommodating patrons and those who wanted to enjoy the service.

Fundamentally, if we as a Government believe in putting more money back into people's pockets and in rewarding work, there is absolutely no reason we cannot follow the French example and make all tips tax-exempt.

This is an important Bill for workers in the hospitality industry, one third of whom, Sinn Féin found in a 2016 survey, were not being paid their tips. More recent research has suggested that the figure nowadays could be as high as 50%. In 2017 we in Sinn Féin introduced a Bill to address this. Despite Fine Gael's opposition, the Bill passed all Stages of the Seanad. It also prompted a national debate on the way in which a proportion of workers were being let down by their employers. Of course, it has to be noted that many employers are very mindful of their employees and distribute tips fairly. There remains, however, a proportion of employers who do not. It is that part of the sector we have to address through this legislation. Thankfully, Fine Gael and, by extension, the Government, have finally seen sense. The One Galway movement, Unite, SIPTU and Mandate have to be recognised for their tireless work on getting this over the line. Sinn Féin's Senator Gavan has to be thanked and commended on his commitment to getting this on the agenda.

Before I get into the specifics of the Bill, I will address the workers across the State who are subject to poor pay and insecure contracts and who, despite their hard work, do not come out of it with a living wage. They are the people who are foremost in our minds. Time and again we hear of cases in the WRC that are labelled in the media as "recovery of unpaid wages" cases. In essence, and truthfully, they would be more accurately described as "stolen wages" cases. Who are those who are targeted in this way? Predominantly, they are women and migrant workers in the food, drinks, hospitality and retail sectors. Some 43% of low-paid workers work in hospitality, retail or wholesale, yet for ten years employer groups in the hospitality sector have shirked the JLC system. Given the supports given to that sector during the pandemic, it is time such employers engaged with and re-established the JLCs.

This Bill ensures that tips cannot be used to top up a worker's wage but, rather, are in addition to a worker's wage. An important amendment the Seanad made was to ensure that service charges are treated the same as tips and gratuities. That is incredibly important to workers.

One issue that needs to be addressed further on Committee Stage, however, is the right to redress in respect of cash tips not passed on. That right applies to electronic tips, but the cash alternative needs to be addressed.

Finally, the WRC is a key player in all this but it needs to be strengthened for the benefit of workers. We have to ask why, for so long, workers have not been afforded the opportunity to look forward to a career in these sectors. Why is their work not considered as having a future? It is because they have been disregarded for too long. This Bill is one step on the way to addressing some of that. However, until the employer groups sit down with the trade unions and re-establish the JLCs, the industry will continue to fail its workers, which would see the industry doing itself a real disservice through high staff turnover and a lack of experienced, valuable workers.

I am delighted to speak to this legislation, which is welcome. I salute all the workers in hospitality and across a range of other services, some of which may not be as visible, including those in the taxi industry and in transport and across the whole spectrum. They have had a torrid couple of years. We all appreciate that.

This Bill relates to tips for employees. People always give tips in good faith. It is an Irish thing. It is voluntary. Most employers pass on tips and look after their employees. A number of us here are employers ourselves. Many employers have good relationships with their employees and look after them kindly and fairly. It is important that this legislation roots out the employers who would dream of taking tips or service charges to which the front-line workers who look after us are rightfully entitled, as are the back-house workers, which I think a few of us never recognise. Tips go to receptionists and chefs and the people we do not really see. Most institutions share tips with their staff. Most of the time I spend in hospitality is spent when I am at work here, in the capital city, and in all the many institutions I have stayed in I have met only the best of people. I am speaking only for myself. Others can speak for themselves. These staff look after us. At present I am staying in the Martello Hotel in Bray, and the staff there are exemplary: kind, caring and helpful in every way. I thank them for that because there is no place like home, as we know, and the Martello is like a home from home. That goes for everybody from the receptionists right through to the kitchen staff, the house staff and the bar staff.

The campaign that was led a few years ago against a restaurant down the street had to be led when we see the money that was spent on doing up and revamping that premises. Then we saw unsavoury treatment of staff. It happened, but I am glad Members tabled Private Members' business relating to the matter. I know that these are difficult and challenging times for employers, but when people decide to give tips they must be passed on. The difficulty is how cash tips kept and not passed on are dealt with. That is not dealt with in the Bill. Yes, electronic tips can be traced and maybe dealt with.

There has been mention of the WRC and so on, but to go down that road is very unwieldy and a very slow process. Maybe it has to happen, but I would prefer goodwill and respect to prevail, and respect works both ways. If the employer gives respect, he or she gets it back in spadefuls from the employees.

The Rural Independent Group supports this legislation. I hope that its passage will make a change to the unscrupulous employers who behave in a bad way and that the relationships ordinary employers and their staff have fostered will continue.

This legislation was originally introduced by Senator Regina Doherty when she was Minister for Social Protection. I thank the Tánaiste and the Minister of State, Deputy English, for driving this important legislation forward. It is important for a couple of different reasons, as many other Deputies have highlighted, and it is great to see such unanimity on any legislation. It is important for transparency and for every customer who uses hospitality services to know that the money he or she adds to a bill as a tip goes to the people who work in that business. It is important to have clarity from the restaurant's perspective in order that it is not accused, as some have been, of appropriating tips inappropriately or in a way the customer did not intend. On the basis that only a very small number, we hope, have engaged in that behaviour, this Bill will allow for transparency and a stronger reputation for everybody in the industry, which I am sure will be welcome. Obviously, it is most important for workers in hospitality, who now have complete clarity on the money to which they are entitled and how it will be presented on bills. I think the legislation will enhance relationships between employers and employees in the hospitality sector.

As my colleague, Deputy Higgins, said, there has been a transformation in the fortunes of the hospitality sector recently. From a time when we wondered how and when people would get back to work and the circumstances in which they would do so, we are now struggling with vacancies. The Minister of State, Deputy English, will know better than anyone the number of people we need to come to work not just in hospitality but also in other sectors across our economy as our population grows and our economy booms and as we need more and more people to come to work in a range of different sectors. I hope this legislation, as well as providing transparency and certainty, will make coming to Ireland more attractive, with people knowing that it is a place where they will have their rights fulfilled, their salaries paid and their tips given to them without any messing around by anyone. It is very strong legislation that balances well the interests of everybody concerned, namely the triangle of employers, staff and customers. I support the Bill wholeheartedly.

I echo the words of my colleague, Deputy Carroll MacNeill, on the Bill. I very much welcome it, I commend the Minister of State, Deputy English, and the Tánaiste on bringing forward the legislation and I thank everyone who has been involved in the process to date. It is very important legislation and gives more fairness not only to the workers in the industry but also to customers who will now know exactly what will happen to their tips. As someone who worked for many years in the hospitality sector and who was quite good at getting tips, I appreciate that it is appalling when some employers do not play fairly and do not reward their workers.

It is also very shortsighted and is so unfair on workers when it happens. This legislation will, I hope, try to eliminate that or certainly reduce the instances of it. I am speaking from the perspective of someone who helped himself through college and through those formative years mainly through the tips I earned more than by my wages. It made the difference between being able to get by and not get by at times.

It is also an incentive and a reward for working and trying harder. As Deputy Mattie McGrath was talking about earlier, we have some outstanding people in the hospitality sector both on the front line and behind the scenes who work very hard. Tips being available for them to keep and to improve their livelihoods is very important and should be incentivised. This legislation will go a long way to doing that and to provide the clarity and certainty also to the customer so that he or she knows what the position is.

I also grew up in a household where my father worked in the hotel sector for almost 40 years. Again, I know that the tips for him were a very significant part of his income and made a great difference to our household over the years.

An incentive brings out the best in people, to try and work harder and to look after customers if they are going to be rewarded for that. That is the way any economy should function in that the harder one works, the greater the reward should be. Certainly, by doing this, we are helping that spirit.

A great number of young people work in the hospitality sector and can sometimes be exploited. There is a duty on the Government to do as much as it possibly can to try to eliminate that where possible and this legislation is another part of that action which is welcome.

My children are in the Public Gallery today and I welcome them. They have come all the way up from Kerry. In a few years, I have no doubt, they will be working in the hospitality sector. As the Chamber knows and as Deputy Michael Healy-Rae said yesterday we in Kerry are the undisputed capital of tourism in Ireland. We disagree on some matters but we certainly agree on that.

There is no shortage of work, thankfully, in the hospitality sector in Kerry and they are crying out for staff at the moment. It is very important for young people. The vast majority of employers are excellent and look after their staff but there are some who do not treat their staff properly. Again, that is very shortsighted and unfair because none of us would want any of our children to be treated like that and it should not be the case for anyone. People who come into this country from other countries and work hard also need to be protected by legislation. I thank the Minister of State for his work on this Bill. I look forward to seeing it being enacted and seeing the impacts on the ground within the hospitality and tourism sector.

I also say to the Minister of State that it is very important that we try to make it easier for employers to be able to bring in the skilled people they need, as we know that there are very many jobs which are not filled at the moment. That is a great challenge to the industry. Anything that he can do to streamline the system for employers is welcome so that they can bring in the people who are needed with the critical skills that are required in the economy. I call on him and on the officials within his Department to keep up the work to try to improve the situation. I am constantly being contacted by people in my constituency in Kerry who want to bring in chefs and various other skilled employees and are encountering very significant difficulties with permits and all of that. The situation has improved but still needs some work and I thank the Minister of State for the work he has done on this to date. He is always very obliging on any occasion I contact him for help in that regard. It is something that is holding the industry back and is also preventing more tax coming in from that industry, tax which is welcome for all services.

I welcome this debate on the Payment of Wages (Amendment) (Tips and Gratuities) Bill 2022 and that the Government have brought it forward. I also welcome the fact that they are willing to listen to the issues around the service charges and have changed the legislation as it came before the Dáil.

It is very important to recognise that this Bill would not be before us if it were not for the brave stance taken by two female migrant workers, Julia Marciniak from Poland and Lenka Laiermanova from the Czech Republic. They objected to having their tips stolen by the management of The Ivy restaurant along with other workplace issues, like cameras in the changing rooms when staff were changing into their uniforms, breaks etc. Tips were stolen by management and the service charge was used to top up the difference between the minimum wage and their contracted hourly rates. Where the rest of it went, we do not know, but it was certainly not paid to the workers.

They joined the Unite trade union, for which they were sacked, and subsequently won a judgment of unfair dismissal at the Labour Court, which has a very high bar in proving that one has been sacked for joining a union. It is probably ironic that it is the only issue on which the union could take on their case, because they were not working there a year and an employer can sack a worker for any reason up to a year. That interval should be brought back to three months as an urgent issue that faces workers in the workplace, particularly in the hospitality sector, where workers move around a great deal. One can spend a year or a year and a half, and when one then goes on to another job one has no rights yet again.

This is a lesson for all workers and especially for those in the so-called hospitality sector. In far too many instances this sector offers little if any hospitality to those who work in it.

I gave a guarded welcome to the Bill and I thank the former Minister, Senator Doherty, for the initial introduction of this Bill. The initial Bill, however, did not go far enough and we are obviously here at this stage now. I say "guarded welcome" because I believe that the Bill introduced in the Seanad by Senator Gavan was much more straightforward in dealing with the issue of tip theft. This practice was not confined to The Ivy restaurant but was in fact widespread in the hospitality sector.

I also want to recognise Dr. Deirdre Curran, the lecturer and researcher in NUI Galway who has produced surveys and reports on the abuse of workers in the hospitality sector, particularly in Galway. I also recognise the One movement in Galway and Cork and Deirdre Falvey who was one of the journalists who exposed what was going on in The Ivy restaurant and in other restaurants in her pieces and articles in the newspapers. The Bill needs careful scrutiny when it goes to Committee Stage to ensure that there are no loopholes which could allow employers to nullify the measures in the Bill.

On mandatory charges, section 4D of the Bill says that if such service charges are similar or give the customer the impression of being a tip for staff, they must be paid to staff as a tip. The Bill, however, does not clarify what is or is not a mandatory charge, which the employer can then use to cover costs, including wages. We may see employers introducing a table charge or something similar, like they sometimes put out in their tweets, such as a group booking charge. This may deter customers from leaving a tip because people may think it is a service charge and may not think beyond where that charge is going. On that basis it must be made very clear exactly where charges are going, that they are well displayed and that customers really know exactly where the money is going. Some form of amendment may be needed to clarify this issue and I ask the Minister of State to clarify that issue.

I will return now to Julia and Lenka. Their stance and victory in the Labour Court should be celebrated throughout the trade union movement especially by the Unite trade union, where Julia is now an organiser for the hospitality sector. This issue should be to the forefront of a union campaign, especially for young female migrant workers, and males also, but particularly females who make up the greatest concentration of workers in the hospitality sector. The message should be that you do not have to put up with low pay, do not have to be at your employer's beck and call with precarious contracts, do not have to put up with being treated with contempt by jumped-up so-called managers, and that you do have rights. To enforce your rights, to end poverty pay and precarious conditions, you have to get organised, join a union and fight back. Young workers are to the forefront of fighting back in Amazon, Apple stores and Starbucks, all of which have high concentrations of young workers. They are joining unions and taking on their employers on their pay and conditions. Young workers and women can be the key to the establishment of an active, militant trade union movement which is as needed today as ever it was in the past.

Finally, I thank all of the activists who were outside The Ivy restaurant who Deputy Higgins heard supporting the workers there, who came out week after week to support them, for the tremendous work they did and for their activity in and around that issue.

I thank the House for its support. I thank the contributors to the debate on this very important matter. It is very clear from all of the contributions from the members of the different parties that there is great support for the hospitality sector and acknowledgement of its importance and that of all of those who work extremely hard in it. Many of us have worked in the sector over the years. For many people, it is their first or second job as they go through education or find a new career. We would like to develop the sector as an important long-lasting career in itself and, as Deputy Bruton referenced, a sustainable career that is well valued and well recognised. I hope that as we improve the terms and conditions in the sector, particularly with the Bill, it will make the industry more attractive to talent and will make it a more successful career.

I hope the Bill will reward those working in the sector. It is hard work and very often people are on their feet for a long period of time. They work long and often antisocial hours. The jobs are not traditional 9 a.m. to 5 p.m. jobs. I thank Deputy Joan Collins for remaining and waiting for her slot in order to give some of the history and name the people involved in the campaign at a very early stage. It is important to recognise those workers who took a stance. I thank those who took up the campaign afterwards. Senator Gavan did a lot of work in bringing forward a Bill. That Bill was not fully acceptable the way it was. The WRC's advice was that it would not be workable or enforceable. Senator Regina Doherty brought forward a Bill when she was Minister. It built on the work of Senator Gavan and others. That Bill had gone through Committee Stage but we had a general election in 2020 and we had to go back to "Go" on the Monopoly board.

Along with the team with me in the House today I thank the Tánaiste for taking up the Bill, improving it and making changes. The legislation started in the Seanad. We amended it last week and we are now on Second Stage in the Dáil. I hope we will be in a position to complete the passage of the Bill before we rise for the summer. The Tánaiste wants to do this and I hope we are able to do so. I thank everyone for their help and support. The Senators made a great effort to get it through the Seanad last week.

The Bill is about fairness. People earn their tips. When customers give them in good faith they expect the staff to have them. They should have access to the tips and they should not be kept by an employer for any reason including to make up wages. That is not what they are about. People are rewarding service and thanking people. They are giving the tip or gratuity on the assumption that it is passed on. This is why the Bill is about fairness and making sure people get their entitlements.

The Bill is also about transparency. It is quite clear from many of the contributions today and in previous debates on the Bill that there is a misunderstanding about the term "service charge". The Bill corrects this and deals with it. If "service charge" is used as a term, the money will go as a tip to the staff. We will allow other terminology to be used because we cannot interfere. If restaurant or business owners want other structures they are entitled to have them once it is very clear that if it has to do with the service and the people employed the money is theirs. This is why people give it. Booking charges and room charges are allowable. We cannot stop this. It is a choice for business owners and the structures they charge. If there is any link to service we want to cut out any opportunity for misunderstanding.

I worked in the sector. I have always known that a service charge did not necessarily involve a tip or a payment of a gratuity. I have discovered since that most customers thought they were leaving a tip by paying a service charge. The Bill corrects this, deals with it and clarifies the position. It also makes sure that a hospitality establishment must have well displayed what its policy is on tips and gratuities, be they paid in cash or by card, and how they are distributed. This is only right and proper. It will be very clear and we will deal in regulation with how visible it will be.

An issue was raised with regard to the regulation of cash tips. Deputy Mattie McGrath touched on it. It is very hard to deal with this matter because it involves cash, which we cannot trace. The WRC has been very clear in its advice that it would be unworkable. Naturally, we are focusing on card payments, which are probably in the majority now. We are also focused on the policy of how cash and card tips will be dealt with. This will bring the change that is needed. It will bring clarity. It will help the overall attractiveness of the sector.

I thank everybody for their contributions. Deputy Griffin touched on how successful he was at getting tips when he worked in Kerry. I have no doubt this was because there were plenty of tourists there in the first place and the gift of the gab probably assisted him to get some of those tips. Many spoke about their time working in the sector and how valuable they found it. We all learned a great deal in the sector. I hope we will make it a long-term sustainable career. The Tánaiste is very clear on this point. He has shown this over the past two years through his work in the Department. If we can improve the terms and conditions to ensure work always pays, and that it is always fair and that people get rewarded for hard work, it should help many employers in the competition for talent and make Ireland a more attractive place for talent.

Deputy Griffin and others touched on talent coming here from abroad and the permit system. The Department has moved to treble the number of staff working in the sector to deal with a backlog. We recognise there is competition out there and it is difficult to source people for all of the jobs that are available. Thankfully, we have seen a major recovery since Covid. Many thought we would still be at 8% or 10% unemployment at this stage. We are below 5%. It is better than it was prior to Covid. I am delighted this is the case in the hospitality sector because it took a major hit, along with many others. The hospitality sector was asked to close its doors. In many cases staff were left not knowing what the future was. I am delighted the staff are back and the sector is fully opened and there is that choice. Many people have taken up jobs in different careers in different sectors. They had a choice. They did not have a choice when they were not allowed to go to work because of Covid.

The majority of employers do the right thing and we have to remember this. The majority of employers look after their staff extremely well and make sure they get their tips and cash. We have to recognise that employers went to great lengths during Covid to protect their staff, employees, teams and talent, as well as their customers. This should be well recognised. We have brought forward this Bill to catch those who do not look after people and who do not do the right thing. I am quite confident that the Bill will not burden anyone doing the right thing, apart from having to display the policy. There are other companies and businesses that will have to change the way they do their business and rightly so. People are entitled to this money if it has been left them to thank them for their work and their service.

The Bill gets the balance right. Deputy Bruton touched on this. It is important that the Department, which has responsibility for enterprise, trade and employment matters, gets the balance right. We are trying to protect and grow jobs, not take them for granted, future-proof the economy and make sure that employees are well looked after and well protected and get thanked for their work. I thank Deputies for their co-operation.

Question put and agreed to.
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