I thank the Chairman and the committee for the invitation to appear before them.
Mandate is one of the country's largest private sector trade unions representing 45,000 workers across retail, distribution, administration and the licence trade. It is therefore not a surprise that our membership comprises predominately female part-time workers. Significantly, the sector in which we are active counts for 15.5% of employment in our country.
From an individual worker perspective, it is crucial to note that the importance and value of retail work has significantly increased largely due to the loss of employment in other traditional sectors, such as construction and manufacturing. In many instances, the earnings derived from retail have become the principal income for households. Therefore, it is fitting that appropriate attention is focused on the concerns of all workers in the sector and not just those with union membership. Furthermore, decent pay, which is an issue that we wish to highlight and discuss with the committee, is more than a sectoral interest in that it touches the lives of all workers.
Quality of employment is crucial from a societal perspective: it not only shapes how economic activity is generated and maintained, but affords significant swathes of citizens the basic human right to access and sustain decent work in order to allow them and their families to fully participate in the society in which they live.
Since the 1970s, there has been a growing concern about the growth and prominence of what is referred to as precarious work. Ten years ago, seven in ten workers worked at least 35 hours a week. By the end of 2011, this had fallen to six in ten workers. Recent Central Statistics Office, CSO, data show that the share of involuntary part-time working is also growing, with more than 135,000 workers classified as underemployed representing a staggering 46% increase on 2008 figures. Those figures are the highest in the European Union.
For the purpose of this discussion, precarious work arises from uncertain, unpredictable and risky provisions contained in employment situations or contracts. Labour market security for these workers is increasingly eroded by demands for greater flexibility to hire and fire, growing use of temporary and part-time contracts, flexible working hours, downward pressure on pay, and limited investment in training and upskilling, along with an erosion of social security rights. These workers are trapped in jobs that do not allow them to earn a living wage and, at the same time, deny them the opportunity to seek another job or even to quality for social welfare payments.
Typically, certain groups of workers are more exposed and affected than others - women, young people and migrants are all over-represented. It is sad that basic protections for those vulnerable workers, such as statutory minimum wage, joint labour committee, JLC, pay arrangements, the low income tax regime for low-paid workers, along with social protection, were among the first areas to come under pressure as the recession took hold.
Against that backdrop, it is important to note that the Irish labour market is one of the most flexible, with the Organisation for Economic Co-operation and Development, OECD, statistics showing that we are placed sixth out of 42 countries. More significant is that the same figure shows that, from an EU perspective, only the UK is more flexible. It is remarkable that in such an environment our social protection regime remains lean. More than 25% of our workforce is low paid, with the national employment survey showing that workers in the wholesale and retail sectors are the second lowest paid in Ireland, with only accommodation and food service employees earning lower wages. Recent EUROSTAT labour costs annual data show that Irish retail labour costs are 20.6% below the average of EU-15 countries, 16.2% below the average other core EU-15 countries and 37.4% below the average of other comparable small open economies.
The economic crisis has exacerbated the problems. Total consumer spending has fallen by more than €11 billion from its peak. It is solely this fall that has been the driving force behind the predicament in the retail sector, not labour costs and inflexibilities. Consequently, we urge the Government to redress some of its austerity measures in the coming budget with a view to introducing confidence-building measures with the domestic economy and retail at the core.
It is surprising that the problem of precarious work receives little study or debate. Mandate therefore commissioned Behaviour & Attitudes to conduct a survey of our membership to fill this obvious information deficit. A unique insight into the financial and psychological distress being endured by low paid workers in the retail sector emerged. However, those difficulties are not unique to Mandate members and it is frightening to consider, if that level of difficulty is apparent in the unionised sector, how prevalent and deep it is elsewhere.
The Behaviour & Attitudes research findings include the information that more than 70% have worked in retail for five years or more; fewer than 33% have full-time contracts and the rest work on average 22 hours a week over at least five days; 50% have their hours changed at least once a month; only 33% have stable working hours; more than 25% sought greater clarity or certainty on their working hours; 40% reported a fall in take-home pay over the previous 12 months, which is an average of €109 a week; 60% were seeking additional hours, 50% of which had their hours cut; 40% were experiencing personal financial difficulties; 70% were less inclined to visit a doctor, which is remarkable; 75% are suffering more stress; 10% have another job; 17% are claiming a social welfare payment; 48% - nearly half - are available five days over seven; and 97% receive no shift allowance whatsoever.
In the economic environment there are those among the employer ranks who argue for the need for total flexibility in employment contracts in order to compete in the challenging and competitive situation that exists. It is ironic that many of the same voices made identical demands during the years of unprecedented growth. They also argue - mischievously and without foundation in our view - that such freedom will act as a catalyst in reducing unemployment levels. The latest focus in this area is remarkable, given the promotion by some for zero-hour contracts.
Certain sectors in an economy require part-time working and flexible working arrangements. However, we are talking about the disproportionate extent to which the offers of such involuntary employment contracts have become the norm. A recent International Monetary Fund review of the Irish economy pointed to the reality that were these involuntary contract workers to be factored in, effective unemployment levels would rise dramatically. The challenge of persistent high levels of unemployment is significant without increasing the burden on the State by swelling the ranks unnecessarily with those who are involuntarily underemployed.
A key consideration behind our recommendations, which will follow the presentation, is the need for an appropriate balance between the responsibilities of employers and the State in ensuring access to decent work. Members should be under no illusions that greater flexibility for employers and the subsequent growth of precarious work increases the need for the State to supplement inadequate pay.
It would be remiss not to inform the committee about how Mandate is directly intervening with reputable and willing employers in an effort to deal with the decent work agenda. Since the demise of the social partnership model, we are increasingly involved in direct collective bargaining with individual employers. During these negotiations we have, in the main, successfully agreed arrangements through which the established weekly earnings thresholds of our members are protected. Moreover, they are guaranteed access to additional hours, in a structured manner when they become available. The valuable and real contribution that agreements make to individual workers, their families and their communities cannot be overlooked. The economic confidence and participation that follows such income certainty must also be beneficial to the domestic economy by making an obvious contribution to the immediate and sustained boost that it requires.
It is argued by some that sufficient statutory employment measures are in place to ensure that such intervention by trade unions is not necessary for workers to ensure that they are not subject to discriminatory, victimising or downright unfair practices in the workplace.
Sadly, based on real experience, this has proven not to be the case. In order to vindicate their rights, many workers had to identify and expose themselves and engage in what turned out to be, in many cases, an individually tortuous process. This, in turn, has led to further exploitation, with many of them choosing to simply leave the employment rather than pursuing their rights. The most recent figures from the National Employment Rights Authority show that if left to the will of some employers, workers will not be given what is legally and rightfully theirs. Based on inspections carried out, the levels of non-compliance are reported to be at 55% for the grocery retail sector and at even higher levels in some other sectors. We would argue, not surprisingly, that the introduction of legislation which provides for real and meaningful collective bargaining rights would assist greatly in improving the plight of precarious workers and in the normalisation of a decent work environment.
Among many challenges, Ireland is suffering a labour market crisis, with persistent high levels of both unemployment and under employment. Therefore it is clear that the requirement to return as many people as possible to employment remains a priority. However, job creation policies must have regard for the quality of the jobs being created and we must ensure, to the best of our ability, that the desperation of those currently without access to an adequate income and a basic standard of living is not exploited and that they return to the labour force willingly and for all of the right reasons. Ultimately, a "more jobs at any cost" strategy will create more problems than it solves for our economy and society into the future.
The State has a crucial role to play in protecting the growing number of working poor through the provision of appropriate legislation, labour market regulations, income supports and training and upskilling opportunities. It is in this context that we are calling for a number of proactive interventions to remove certain traps or obstacles which are encountered by precarious workers in their daily working lives. To address what we call the flexibility trap, we are seeking the introduction of a new code of practice to replace the one that currently exists to assist workers to access reasonable working hours. We are also seeking some PRSI reform to remove the obvious incentives that currently exist and which are leading to an increase in the number of precarious jobs in the economy. On the question of income we are seeking, where appropriate, reform of the jobseekers' payments to recognise the reality of precarious work. We are also seeking the temporary reduction in the number of working hours required to qualify for family income supplement payments. We also believe it would be appropriate, now more than ever, to introduce a refundable tax credit for low-paid workers.
On the question of skills, we are seeking the introduction of an effective training support system for under-employed and low-skilled workers. In the context of exploitation of workers, we are greatly concerned that we still do not have a replacement for the old JLC-REA system. We are calling for the speedy replacement of previous JLC-REA statutory protections with effective mechanisms to ensure that workers can vindicate both their individual and collective statutory rights. We are also seeking adequate funding for the appropriate State bodies to ensure that workers can access their rights through timely inspection and enforcement regimes. As I have already said, we believe it is vitally important that we have legislation on our Statute Books that allows for a meaningful right to collective bargaining. Finally, in the context of this year's budget, which is only a few weeks away, we believe that we should use newly-available funds to reduce the size of the planned budgetary adjustment for 2014-15. We are calling for the introduction of a stimulus package to lift consumer confidence and increase consumer spending which will, in turn, lift the domestic economy.
