Seanad Éireann debate -
Wednesday, 19 Dec 1979

Vol. 93 No. 7

Payment of Wages Bill, 1979: Second Stage.

Question proposed: "That the Bill be now read a Second Time."

Minister for Labour (Mr. G. Fitzgerald)

The central purpose of the Payment of Wages Bill, 1979, is to amend the Truck Acts, 1831 to 1896, so as to enable employees engaged in manual work, who are covered by those Acts, to be paid their wages otherwise than in cash, where both those employees and their employers are agreeable.

The intention behind the Truck Acts was to safeguard the employees to whom they apply against abuses in relation to payment of wages by providing protection against payment in kind; against interference with the employee's freedom to dispose of his wages as he thought fit and against unreasonable or unfair deductions from wages.

The restriction at present obtaining in respect of payment of their wages otherwise than in cash to employees coming within the scope of the Truck Acts arose unintentionally as a result of the Currency Act, 1927. Section 1 of the Truck Act, 1831, required the wages of such employees to be paid in the current coin of the realm; section 8 of that Act made it lawful to pay wages, with the employee's consent, in legal tender notes or by bearer cheque drawn on a bank which was within 15 miles of the place of employment and which was licensed to issue bank notes. The latter restriction has had the accidental effect of making payment by cheque illegal since section 60 of the Currency Act, 1927, removed the banks' powers to issue bank notes. Hence the need for this Bill to bring the present situation into line with the original intention of the Legislature and to restore the pre-1927 position. In so doing, it will end, too, the differentiation in law in this matter between manual and non-manual employees.

I am already on record as saying that any movement away from payment of wages in cash will be essentially an evolutionary process, which can best be effected with the goodwill and co-operation of all concerned—employers, employees, trade unions and the various financial institutions. My intention in bringing forward legislation is to facilitate that process by legalising it for the future and by regularising it as regards the past, with one essential condition: payment of wages otherwise than in cash may be effected only with the mutual agreement of the parties involved.

As I said at the outset, the central purpose of this Bill is to make certain amendments to the Truck Acts. It is logical, therefore, that employees covered by the Bill should be those to whom the Truck Acts apply. Its scope extends also to employees encompassed by the Hosiery Manufacture (Wages) Act, 1874. As that Act was designed to protect hosiery workers by curbing abuses in connection with payment of wages in kind and with deductions from wages, it is considered as legislation related to the Truck Acts. Despite an indication to the contrary in the volume of the index to statutes for the year 1874, the Hosiery Manufacture (Wages) Act applies to this country.

Notwithstanding any provision to the contrary in any other piece of legislation, this Bill will enable the wages of employees concerned to be paid otherwise than in cash, provided that either the employer and employees—or authorised person—have signed a document for that purpose or that there is in force a written agreement to that effect between the employer and the trade unions representing the employees in question. In practice, it is probable that unorganised employees will avail themselves of the document option, with organised employees preferring that of the agreement.

I should like to elaborate on these two options in some detail. Where the document is concerned, it must fulfil three requirements in order to be valid: it must specify the agreed non-cash method of paying wages that is to be used; it must indicate the way in which the use of that method is to be terminated, in accordance with the conditions set out in the Bill for mutual and unilateral termination—bearing in mind that the period of four weeks notice in the case of unilateral termination is the minimum period; and it must be signed by both the employer and employees—or authorised person—involved. Employees may give written authorisation to some other person to sign the document, and unilaterally to terminate the use of the non-cash method specified in the document, on their behalf.

The legislation does not preclude insertion in the document of additional items and any such items could be cancelled by either party in whatever way they had agreed, without prejudice to the remainder of the document. Where the document relates to more than one employee, termination may be effected by individual employees without affecting the validity of the document in respect of the remaining employees involved.

Finally, I would draw attention to the fact that existing arrangements between employer and employees involving the payment of wages otherwise than in cash will if necessary be deemed to be a document signed in accordance with this legislation, and can be terminated in the same way as such a document. In this way, the use of any non-cash method which may have been used in the past in contravention of the Truck Acts by virtue of the Currency Act, 1927, will be regularised.

As to the second option—the employer/trade union agreement—in essence, it permits the employer, or a group of employers of which the employer is a member, and any trade union or other body of persons recognised by the employer for the purpose of collective bargaining negotiations, of which the employee is a member, to have a written agreement about paying the employees' wages otherwise than in cash. Termination of the use of the specified non-cash method will be effected under and in accordance with the agreement, that is to say, either following a review of the position, if the agreement provides for a periodic review, or by one party giving notice to that effect in writing to the other party concerned, such notice being that which was specified in the agreement and being a period of not less than four weeks.

I should mention that the employer/trade union agreement may be made either before or after the passing of this Bill. This agreement option will apply to a trade union or to a staff association recognised for collective bargaining purposes. It could also, of course, apply to a multi-union situation. It would cover a contract of employment if the terms of that contract had been negotiated with the trade union or unions involved. It would bind prospective employees who were members of the trade union, or who became members of the trade union on joining the firm in question, which was party to an agreement of this kind with the employer.

Before I leave the two options contained in this measure I should like to clarify that the employer or the employee or his trade union can take the initiative in relation to suggesting that wages might be paid otherwise than in cash. The payment of the wages by a non-cash method can only be done, however, by consensus. If one or other of the options are taken up the non-cash method to be used will have to be chosen among the list of payment instruments and modes of payment referred to in the Bill.

This list, which follows generally on the provisions of section 26 (6) of the Central Bank Act, 1971, includes: cheques, bank drafts, promissory notes or other documents issued by a customer for the purpose of enabling a person to obtain payment from the customer's bank account, payable orders and other documents issued by a public officer for the purpose of enabling a person to obtain payment from a Government Minister, as well as cheques and other documents drawn on trustee savings banks.

Additions may be made to the list by regulations made by the Minister for Labour following consultations with the Minister for Finance. Thus, provision is made for flexibility in relation to the possible future establishment of new kinds of financial institutions, payment instruments or modes of payment. It will be seen that the existing list affords both employers, employees and trade unions a wide variety of non-cash methods from which to make a choice, so as to facilitate their being able to use the one most appropriate and suitable for their particular circumstances.

While good industrial relations practice would dictate that the employer should ensure that his employees are fully consulted before any change-over to non-cash payment were made, in this instance it is essential to remember that, under the Truck Acts, the consent of employees is explicitly required before payment otherwise than in cash can lawfully be made. Such consent must, of course, be freely given. In this connection, the Payment of Wages Bill contains provision to ensure that neither pressure nor coercion will be exerted on the employee where the payment of his wages by a non-cash method is concerned.

Towards that end, any term or condition of an agreement will be null and void if it requires a person to sign, or to authorise another to sign on his behalf, a document agreeing to the use of a non-cash method, or not to terminate the use of any such method where it is already being used to pay wages to the employee involved.

It is recognised that, where an employee is required to work at a place other than his usual place of employment, or is absent from work by reason of illness, on leave or with the consent of his employer, he may prefer, in any of those circumstances, to be paid in cash. If so, all he has to do is to notify his employer in writing to that effect and that written notification will then supersede any document he may have signed or any agreement with the employer to which his trade union is party. However, if the employee does not send written notification to his employer, the employer will be notified to pay him his wages by means of any of the non-cash methods referred to in the Bill.

The main provision concerning deductions is not restricted to employees coming within the scope of the Truck Acts; it embraces all employees, both manual and non-manual.

It obliges the employer, where he makes a deduction from the employee's pay, to give that employee a written statement indicating the gross amount of the salary or wages payable and the nature and amount of the deduction. Examples of deductions would include those for income tax, social welfare, Voluntary Health Insurance, a contributory pension scheme and so on, virtually all employees should, in effect, be affected by this provision. In the circumstances, since itemised pay statements would have to be prepared for practically the entire workforce, it is only fair that employers should be given some time in which to prepare themselves. I intend, therefore, to wait about a year after the Bill has been enacted before bringing this provision into operation by ministerial order.

I should like to emphasise that employers will be required to take such reasonable steps as are necessary, not only to ensure that the pay statement is treated as confidential until it becomes the property of the employee, but also to ensure that the information itself, which is contained in the statement, is treated as confidential by those who are privy to it.

Notwithstanding the terms of any statute referred to in the Bill, the employer will be permitted to make deductions from wages to which the employees in question give their consent. In this way it is proposed to resolve, with retrospective as well as future effect, a certain difficulty which has come to light in relation to the Truck Acts and related legislation. The general effect of the Truck Acts is that no deductions other than those required or permitted by statute can lawfully be made from the wages of any employee to whom the Acts apply. For that reason many deductions—such as, for example, the recovery of overpayments of wages, or contributions to pension schemes— which might appear desirable to employers and employees alike cannot lawfully be made, even on a consensual basis, because of those Acts. One can readily appreciate that the relative provisons in the existing law, while originally designed for the employee's protection, can now be against his own interests. If they have not caused that much difficulty up to the present it is almost certainly due to their having been in large measure ignored. They remain, not alone a dormant anomaly, but a potential barrier to developments for the employee's benefit.

Where the employer and employees, or their trade unions, have signed a document or where an employer/trade union agreement is in force about the payment of wages otherwise than in cash, the employer will be prohibited from making any deduction from any wages of the employees by reason only of the fact that the wages are not being paid in cash. In other words, the employer will not be permitted to charge his employees for paying them by means of a non-cash method, or to deduct any bank charges incurred by him in the process. This could not be allowed, especially since the use of the non-cash method in the first place will be by agreement between the employer and employees, or their trade unions.

The earliest consultations on the Trust Acts, of which I am aware, date back to 1959 to a committee which was set up by the Minister for Industry and Commerce and which was representative of the Federated Union of Employers and the Irish Congress of Trade Unions. Needless to say, that was long before the Department of Labour was established. I understand that the work of that committee was discontinued before any conclusions were reached. Following representations from the Minister for Finance in the context of the National Savings Campaign, the committee was reconstituted in 1964, to examine the possibility of a limited amendment to the Truck Acts, for the purpose of legalising payment of manual workers' wages by cheque in cases where the consent of the workers and their employers was forthcoming. The recommendations of the committee were accepted by the then Minister for Industry and Commerce and are now reflected in the provisions of the Payment of Wages Bill.

I might add that the majority of those changes and additions, which have been made to the text of the Bill as presented last February, is based on the outcome of the more recent consultations with interests concerned at ministerial and at official level earlier this year. Accordingly, in commending the Payment of Wages Bill, 1979, to the House, I am happy to say that its revised text is acceptable to both the Federated Union of Employers and the Irish Congress of Trade Unions. With the co-operation of employers, employees and trade unions involved, I hope that this measure will help to bring the payment of wages of manual workers more into conformity with modern conditions by providing a framework for those who wish to move away from the system of payment in cash.

Mr. Cooney

On behalf of this party I welcome this Bill. It is interesting to note that it comes here with the approval of all the parties who will be interested in it when it comes to operate on the ground. Apparently, the approval is unanimous and there is no dissent in the terms of the approval. I go so far as to say that that must be a unique situation for a Bill. I note, too, from the Minister's concluding remarks that the earliest consultation on amending the Truck Acts took place as long ago as 1959 and continued spasmodically up to the present day.

It struck me, when the Minister was introducing the Bill, that there was one startling omission from his speech, and that was the real reason why this legislation is now being put forward. If it had no urgency for the last 20 years, one is entitled to ask why, in 1979, has this commendable piece of social legislation now been brought forward? It is odd that the Minister gave no reason, other than the perfectly valid one that he wants to amend the law and bring it into conformity with present social and commerical conditions. We are entitled to speculate as to whether there might be any other reasons. Quite obviously, the first reason that strikes one as to why the legislation is now being brought forward is the need to take large sums of cash out of temptation's way from the many robbers who are plaguing our society at the moment. It is commonly assumed among the public and, indeed, I am sure it is recognised by the employers' organisations and by the Congress of Trade Unions, that such a reason is a perfectly valid reason; in the context of our times, it is a compelling reason of the highest urgency. I find it slightly, dishonest might be too strong a word, on the part of the Minister not to have acknowledged this reason in his introductory speech. I did not read the debate in the other House; that omission may not have been made in the course of his speech to that House. Listening to him here, it struck me as extremely odd that he would not recognise that a compelling and urgent reason to amend the Truck Acts was to correct the situation where large sums, by way of payrolls, are being held weekly in thosuands of places up and down the country in most vulnerable situation and have provided easy pickings for the gangsters who are plaguing our society.

I welcome the Bill because it tends to cure and deal with that problem. The number of armed robberies of payrolls that have been taking place constitutes a problem of magnitude, and a problem of urgency requiring, not just the partial cure that this Bill will bring as a consequence, but other measures on the part of the Government. The number of robberies is startingly large and is growing as rapidly as our inflation rate; the amount of money that is being robbed is even exceeding our inflation rate. This has very serious consequences for society, because this money, in turn, is financing other illegal operations of one kind or another. It may be financing what we are pleased to term ordinary criminal activities, but what I fear is that this money is financing subversive organisations to continue in their illegal, dangerous and deadly activities. Any piece of legislation which may tend to curb——

Mr. G. Fitzgerald

If I could come in? I do not want to interrupt this House, but there are certain aspects of this Bill before the House, the purpose of which is—on a point of order——

Mr. Cooney

On a point of order, I might point out to the Minister that he is not a Member of the House and it is hardly in order for him to make a point of order. He should talk to the Leader of the House if he wants to make a point of order and wait for a ruling.

An Leas-Chathaoirleach

Senator Cooney is still in possession.

Mr. G. Fitzgerald

If I am not entitled to make a point of order, I am sorry. I was just drawing it to your attention. It is so obvious.

An Leas-Chathaoirleach

The Chair feels that once the Senator is relating his remarks to the Bill he is in order and, on Second Stage, it is in order to speak about what ought to be in the Bill.

Mr. Cooney

I am obliged for that ruling. I can appreciate the sensitivity of the Minister in my dealing with the subject which he chose to ignore when he was opening the debate. The fact that I speak about it probably adds to his embarrassment and possibly provoked his interruption.

I was making the point that the Bill is of benefit because it reduces the opportunities for the robbery of large sums of money. I was making the point that it is important that those opportunities be reduced because those stolen sums of money are finding their way into hands that are inimical to our society and our State and are financing further depredations and damage to our social fabric. I want to emphasise that the solution to that problem, and the bringing of it to an end, is a matter that requires an urgency not just on the part of this Minister but more especially on the part of his colleagues who are directly charged in that area of responsibility.

It is not going to be possible to remove temptation or opportunities totally from the way of would-be robbers. Efforts should be made to reduce their opportunities by increasing the security precautions in firms that might decide in the future not to avail of the provisions of the Bill for the payment of wages otherwise than by cash. It will be some time before there is widespread availing by employers and employees of the changes proposed in the Bill and during that interval the temptation and opportunity will be there. It should be brought home to people who have temporary custody of large amounts of cash on their premises for the purpose of paying wages that they have a duty to protect that cash as strictly as possible. I do not think the banks have discharged their responsibility in this regard. It is too easy for banks to be robbed. There are simple inhibiting features that could be built into the bank premises physically. There are modes of operation that could be arrived at which would inhibit large-scale robberies. Likewise, in the case of employers to whom this Bill applies there would be ways and means, in consultation with the people in charge of our security, whereby they could improve the security of their premises or their cash offices pending the coming into operation of the measures proposed.

I urge the Minister to encourage the adoption of all possible means by people in charge of large sums of cash that will prevent the robbery of that cash, because the dreadful consequences to our society are too serious to be treated lightly and require a serious and thorough response from anyone who can help. I would be glad to hear from the Minister if it was in his mind when bringing forward this Bill to do something to counteract the ease with which robberies of payrolls have been taking place. Does he want to see a situation where that temptation or opportunity will be removed? I would be interested to hear from him on that. Would the Minister be prepared, pending the coming into operation of the Bill in its fullest extent, to urge employers to adopt as stringent security measures as possible, so as to at least inhibit these robberies? The police are always available to offer expert advice, and I ask the Minister to encourage employers in this situation to seek it.

The operation of the changes will be voluntary and it will be a matter for the parties to agree. It is encouraging to know that the Bill is being brought forward with the blessing of both the employers' side and the employees' side. That agreement has been obtained from the two associations, The Federated Union of Employers and The Irish Congress of Trade Unions. One might say that it is an agreement in macro-terms. The Minister now has an obligation to get in touch with individual firms, individual employers and employees in certain firms and encourage them, directly through his Department or through their trade unions or staff associations, to avail of the changes proposed in the Bill. What we want to do is get cash out of circulation as quickly as possible. The urgency of the problem puts an onus on the Minister to take unusual steps towards implementing his legislation as soon as possible. It is not enough for him to appeal to the Federated Union of Employers or Congress. He has to go behind them to the individual members on a company basis and ask them to implement the provisions as quickly as possible.

The Minister may encounter certain opposition because one of the first things employers or employees may say to themselves is that if they go from cash to cheque they are putting a certain amount of trouble on themselves. An employee is more likely to complain because he has the bother of cashing the cheque, and of deciding the venue where he is going to cash it. It may not suit him to cash it in a local shop, the amount of his cheque may be confidential to him. The bank in his area on a Friday evening may close at 3 p.m. That is a factor that could inhibit the widespread use of the changes proposed. The Minister will have to consider approaching the banks so that their long opening day, which varies from town to town, is standardised to a Friday throughout the country to enable employees to have the option of going into a bank. It is a more impersonal place for the transaction than, perhaps, going to the local grocer or butcher and changing a wages cheque there. It can be a matter of some sensitivity, particularly if there are deductions being made from the cheque for one thing or another. I strongly urge the Minister to consider that, because it could be a factor that would inhibit the use of the measures proposed.

There is a situation that will arise in the case of a bank strike, not unknown in this country and something we have to assume can happen again. The possibility of that happening could be a factor inhibiting workers or employers from using the provisions of the Bill. The Minister will have to think about how he is going to overcome that objection should it be raised. It is a valid objection, because if there is a bank strike cash gets scarce and there will be a certain unwillingness on the part of shopkeepers to change cheques, although they will balance that against the custom that will be coming in as a result of changing the cheque. It will be a factor that will make the cheque in the employee's hand less attractive than hard cash, a factor that might inhibit him from making an agreement under this Bill.

Again, too—and I think this happened at the time of the more lengthy bank strike—there was a situation where certain shopkeepers were left with cheques on their hands when the banks reopened. The cheques were dis-honoured because the business in question had gone into liquidation during, and possibly as a result of, the bank strike. I think this happened in the case of one particularly large company in this city. While wages cheques may have some priority in liquidation, that is scant enough consolation to the person having to answer to a shopkeeper for a number of wages cheques.

I know the Minister has provided in the Bill for the termination of the agreement and one could say that in the event of a bank strike the parties mutually terminate the agreement and payment in cash can then take place. If there is not mutual agreement to terminate it and it has to be terminated unilaterally, it requires four weeks' notice. I think that in the situation which I have outlined four weeks could be too long. The Minister would want to consider some procedure whereby an employee could unilaterally terminate the agreement in the event of a bank strike so that he could be paid cash and not be forced to cash his cheque to a shopkeeper who may not want to cash his cheque because the fingers of quite a few people were burned with wages cheques following the longer of the bank strikes. That sort of word spreads around very quickly and in the event of a bank strike a person employed in a firm that had any question mark about its viability might find himself left with a useless piece of paper. This might be a real problem and the Minister would want to give consideration to it. I think the right to terminate unilaterally at four weeks' notice is a good one; but four weeks in the context in which I speak is, I would submit to the Minister, too long.

Arising out of the Minister's speech, there are one or two queries I would put to him for clarification when he is winding up the debate. He mentioned in his speech that the agreement for payment by cheque has to have three requirements to be valid. I raise no question about them. They are perfectly proper. He also says that the legislation does not preclude insertion in the document of additional items, that any such items could be cancelled by either party and so on. I would be interested to know from the Minister what other items he would have in mind or what he would anticipate could come into the document agreeing for payment by mode other than cash. I do not know whether we have Post Office Giro at the moment in this country. I have an idea that it was introduced but never operated. I would ask the Minister to let me know if Post Office Giro would be covered by the modes set out in section 3 (3) paragraphs (a) to (g) or would it have to be provided specifically in regulations by the Minister? Would Bank Giro, which we do have, come under the existing definitions? I think it probably would. It could probably be in the form of a draft. However, the Minister can clarify that for us. If Post Office Giro or Bank Giro do not come under the methods proposed, I suggest to him that he should make regulations, as a matter of urgency, to permit payment by both of those ways or by only one of them if only Bank Giro is available.

The Bill proposes changes in the law to permit deductions from wages. That is good and I am glad to see that it is being made retrospective. I am not aware of any cases where deductions might have been made by consent, but invalidly, and were recovered. It may have happened. Unfortunately, the Minister can hardly go so far as to cure those situations; but at least where there has been no action for recovery up to now he is regularising the position. He is also going to make provision for the confidentiality of the nature of deductions being made from wages. I commend him for that. That is very desirable but it is going to be a difficult thing to achieve because a certain number of people will be involved in the making up of wages and wages slips. There is the possibility that a very sensitive deduction may be involved—for example, as a consequence of an attachment order or the like or payment of maintenance under a court order or agreement. While the Minister is to be commended on his desire to obtain confidentiality in this area, I just wonder if it is an empty hope? I would be glad to hear from him as to how he thinks this might be solved. I take it that deductions made on foot of an attachment order will be covered by the Bill.

The last question that I have for the Minister relates to situations where the agreement for the payment by cheque is made not by the individual employee but by a trade union or by a staff association on his behalf. The Minister mentions that there could be a multi-union situation in a firm, so I presume that if there were three unions in a firm the firm could have separate agreements with each of the unions. What I worry about is the position of an individual worker who might decide he does not want to be in a union at all—of course he may be caught by the closed shop and not have any choice, his freedom thereby limited, regrettably. Let us suppose, for example, it is not a trade union situation, that it is a staff association situation, that all the employees are in the association, and that, there is an agreement with the association. If the person resigns from the association and wants his payments in cash thereafter, is he, as an individual, entitled to opt out of the arrangement made by his staff association with the particular employer? Can he determine the agreement as an individual though it was entered into on his behalf by his association? If there is any doubt about that, the Bill should provide that possibility for such a worker. I think the individual's freedom and rights demand that that option would not be taken away from him and that it should be there for him as an individual if he wants to reassert his right to obtain his wages in cash. He might have excellent reasons, reasons perhaps to do with confidentiality, reasons that could be commercial, reasons to do with the method of family budgeting, any number of good and valid reasons. He might want to opt out of the arrangement made by his association or trade union. I would like to be reassured by the Minister that such a person will be entitled to opt out on giving the four weeks' notice as in the case of an individual agreement between a worker and his firm.

That is all I have to say except that I welcome the Bill. It is good for the social reasons that the Minister mentioned or hinted at in his introduction but even better for the security reasons I mentioned.

Professor Hillery

This Bill is not concerned with ensuring the security of payroll moneys. The central purpose of the Bill is to restore the payment of manual workers' wages by cheque or other non-cash method of payment to the position which obtained prior to the Currency Act of 1927. However, with the expected changeover to non-cash methods of wage payments to manual workers which should follow this enabling legislation, the opportunities for robbing payroll cash by criminals should diminish.

The Bill legalises the payment of manual workers' wages by cheque or other payment instrument, thus ending the distinction in law between manual and non-manual workers. This is a small but significant change, because any measure that removes distinctions between these two categories of workers is welcome in that it advances the approach towards a single status for all employees in the workforce of any organisation. Too often in the past distinctions between manual and non-manual workers have served as a source of irritation and potential conflict. I share the view that payment by cheque or other non-cash method should not be compulsory, but hope that through agreement in individual employments payment of manual workers' wages by non-cash methods will quickly evolve and become the general practice. Clearly, both employers and workers will need some time at least to adjust and to prepare for non-cash methods of payment.

In conclusion, I wish to make the point that many workers do not use the facilities of financial institutions. This legislation will likely lead to an increase in contact between manual workers and financial organisations, particularly banks. Such contact, in turn, should lead to creating a greater awareness of the wide range of banking services available and, for example, may well serve as a stimulus to saving.

Mr. Kennedy

This Bill meets all the requirements of the trade union movement in respect of this matter. I have only one reservation but I do not think a great deal can be done about it. It is the same reservation mentioned by Senator Cooney—the four-week period before a system of payment can be revoked. I would ask the Minister to consider this period as it appears to be a bit too long in the event of a bank strike or other problems.

There is one other matter I want to mention which may be related to this subject. I read a letter in the paper the other evening from the wife of a soldier serving in the Lebanon. She complained that her money was paid by cheque. She presented the cheque in a bank and was told that as she did not have an account in the bank they could not cash it unless she produced somebody who was known to the bank. If that situation prevails in respect of the wives or dependants of soldiers serving overseas, the Minister should ensure that their cheques are cashed on demand in any bank.

Mr. Lanigan

I welcome the Bill. For a number of years I have been involved in the payment of wages in a small company and we have been using non-cash methods of payment. Senator Cooney referred to the methods of non-cash payment. I should like to instance what I consider to be a competitive element in banking. A bank official asked me if he could talk to my staff in connection with the payment of wages. A short time afterwards bank accounts were opened on behalf——

Mr. Cooney

Banks do not compete but bank managers do.

Mr. Lanigan

——of some of the employees. It may have been in contravention of the Truck Acts but from that time the wages were lodged each week to the individual accounts of the employees in the bank involved. Anybody who did not open a bank account was paid in cash. I have found that there are difficulties in the non-cash method of payment for both employee and employer. As Senator Cooney said, these difficulties arise during bank strikes when wages have to be paid in cash. There should be no difficulty with the four-week period if both employer and employee agree that wages can be paid in cash during a bank strike. As employees must be paid it is up to employers to overcome the difficulties that might arise.

I am glad that the Bill provides that an employee be given a document stating his gross earnings and his deductions. Irrespective of what way he is paid, he will know exactly what he is being paid. On occasion employers have created difficulties by lodging wages to accounts without giving employees the relevant documents.

Senator Cooney referred to security in dealing with cash. It has only recently been brought to public notice that large sums of money are handled by junior clerks in big organisations. These people should not have been responsible for the large sums of money which they have been handling. Thank God they got away with it without too many problems. It is not too long since the banks in the College Green area wheeled millions of pounds across to the Central Bank for burning. Unfortunately those days are gone. It is very important that a girl should not be sent to a bank unaccompanied, even if she is only collecting £1,000 in cash.

I worked in a bank at one stage and the security element in banks in 1960 was no different from the security element in banks now. They have no security in 90 per cent of the banks in this country. There is a ruling, I believe, whereby bank staff are told not to hinder anybody who comes in to steal money. The easiest place to steal money at present is the bank because of the lack of security. A banking institution is an institution which is dealing in cash, in a product, and banks are probably the least security-minded bodies in this country when you consider the commodity in which they are dealing.

An Cathaoirleach

I think the Senator is departing from the Bill.

Mr. Lanigan

The Bill provides for the payment other than on a cash basis of wages. I would sincerely hope that every firm in the country would look at the consideration in the Bill but I also would like people to ensure that wages are not paid in documents that can be cashed in pubs. That has happened in England for many years where certain groups of workers were paid by cheque and the employer knew that the cheques could not be cashed in any other place on the Friday night except in certain pubs which ensured that the employees had to go to these particular pubs and the owners of these pubs were the only gainers.

Senator Cooney mentioned banks staying open on Friday evenings until 5 o'clock. However, if we are going to have payment by cheque we must ensure that wages are paid not on Friday but on Thursday so that the employee will have the opportunity to cash the cheque before Friday evening. It is very important that what happened in England does not happen here. The men on the lump who were earning good wages found that the only place they could cash their cheques was in the pubs. That is something which I would not like to see here. That is one of the main reservations I have about the Bill. Banking organisations will have to change their times of opening; employers will have to change the pay day to ensure that there is at least one banking day after the issue of the cheque. The Bill is a good one and I sincerely hope that every employer and employee will think about it.

Mrs. Hussey

I welcome the Bill very much as a step towards what I hope will be a society in Ireland where there will be far less cash, an almost cashless society. It seems to me that we are all very pragmatic about this Bill. To a great many people it appears that in fact there is a breakdown, a very crucial breakdown in society, because hardly a day goes by when we do not hear of some major robbery of some large amount of cash. People just shrug their shoulders and say "There they go again." It also appears that nothing is being done about it and certainly this Bill means that something has at last begun to be done about it.

The remedy for that breakdown involved in such large scale robberies is available. This Bill will make it more available. It is also very cost-saving if people could understand how economical it would be. Senator Cooney mentioned the fears he felt about the destination of a great deal of the money which was being robbed. It has been estimated——

An Cathaoirleach

That does not arise.

Mrs. Hussey

The Bill will have the effect obviously of cutting down the number of robberies and that is a very desirable effect indeed. When we consider that so many remedies are available to us for arriving at a situation where there is less cash around, it is amazing that we have not taken steps like this long ago and arrived at large scale translation of every kind of transaction into, for example, credit transfers and payments by cheque. In France and Germany more than 90 per cent of wages and salaries are paid by cheque or credit transfer and I think that figure also applies to Sweden. I wonder have we got a figure for this country, as to what proportion of wages and salaries in Ireland are paid by cheque or by credit transfer. I suspect that it is less than 50 per cent, possibly less than 25 per cent, but I do not know. I am speaking on this Bill to try to convey to a Minister of the Government that there seems to me to be a great deal of alarm being felt by ordinary people about the lawlessness that exists in terms of robberies. I welcome this Bill as a step towards dealing with that phenomenon as well as towards more effeciency for employers and employees alike.

Mr. Brennan

It is a strange situation, I suppose, that we should be here on the verge of 1980 making it legal to pay wages by cheque particularly when one has regard to the virtual revolution in the method of payment throughout the world. I refer to the now famous credit card system, or plastic money as it has come to be known. There is a plethora of these credit cards and I suppose it is to a certain extent catching up on that revolution in the method of payments that a Bill like this comes before this House at this time.

Looking through this Bill the key item in it, from my point of view, is the idea of consent, that is, making it necessary to have the consent of the employee and the consent of the employer before any alteration in method of payment is made. I know, from looking through the Minister's speech in the Dáil and hearing his speech today, that he is not anxious for, nor would I seek any element of compulsion in this area. But, given the attraction of paying by cheque, I would ask the Minister to have a close look at the possibilities, ask his Department to examine closely some method of introducing incentive, some method of making it more attractive to reach this particular agreement, some incentive to encourage the changeover to a non-cash basis. I am not clear in my mind at this stage as to what type of incentives one could introduce, what type of financial or other incentive one could introduce, but I daresay that there are incentives, ways of encouraging employees and employers alike to make this necessary changeover because it is worth making. If the encouragement and the incentive are not given I would fear a little that many employees, particularly manual employees, would stay on the cash option. From their point of view it saves them from going to the bank; it saves them the extra chore of getting familiar with the bank manager; it saves another person along the chain knowing the exact amount of what they take home. What I am saying to the Minister and to the Department is that I think this Bill is excellent; it is a great Bill but it must be helped to work with a package of incentives to encourage this consent on which the whole Bill hangs. It seems to me that, if we cannot get that consent, and get the two sides together to make the necessary changes, then the operation of the Bill will be in some danger.

I am delighted that the Bill obliges written statements about deductions. This is very important. Many companies I am aware of do this as a matter of course. It is probably the rogue firms, to a certain extent, who do not do it. I wonder also is there any way of policing this? Is there any way of monitoring it? Could it be, for example, in some way linked with the taxation system? It is a nice Bill but I am anxious to see that it is monitored or policed in some way.

I am conscious, also, of what will be in most workers' minds. It is not the huge moral or other question of whether they would like cash or a cheque. I am afraid it will be something quite simple and quite straightforward: whether or not they can get out to the bank to cash the cheque. I would encourage firms, as I am sure the Minister will, to organise easy access to cashing facilities for these cheques.

There is another point I want to mention because I am not clear whether or not there is operative legislation on it. It seems to me that we have got to a stage where everybody has to be paid on a Friday, and everybody has to take home his cash, or his cheque, or whatever it is, on that day. I often wonder if some national effort could not be made in some way to stagger this on a firm basis, so that there would be fewer security targets and the whole operation could be streamlined.

The point Senator Hillery made is a very valid one. Payment by cheque will, indeed, bring workers into close touch, many for the first time, with financial institutions and financial advice generally and, hopefully, this would encourage saving.

The final point I want to make to the Minister is that a problem may emerge under this legislation. There may be a lack of consistency within particular firms, with some employees opting to change over and other employees deciding to stay on the old system. I wonder is there any way in which the Department can encourage some consistency. I see a danger that if it is messy from the employer's point of view, if he has got some employees saying: "I want to change over" and others saying: "I do not want to change over", then it becomes an administrative headache for the particular employer. Given that situation, some small employers are quite likely to withdraw the kind of consent that is needed to make this system work. That would be a pity. Is there any way in which the Department could examine the idea of trying to do this on a firm basis in some way? I suppose what I am referring to is really the age-old idea of work place democracy.

The Minister has spear-headed much enlightened legislation in the other House and in this House, and I for one am glad that he has added this Bill to his list.

Mr. Jago

Like Senator Lanigan I have had experience in this field. I do not think we need worry about some of the reservations that have been expressed by some Senators. In one case in which it was put in, it was probably deleted because it was put in on an optional basis. In other words, those who wished to be paid by cheque could be so paid, and those who wished to be paid cash could be so paid. After it was in operation for some time, it was so beneficial to the employee that everybody offered to join the system, even manual workers. There is more than just the advantage of security for employers in a system such as this. As wages have increased, the physical job of bringing money from a bank, the physical job of distributing a large amount of money, and the physical job of recording it are so simplified by cheques that the benefit to the employer is considerable.

Therefore, it is in his interest to give an incentive to the employee to operate it. Such incentives can cover the difficulty about the payment on Friday. It has to be covered and has been covered without any difficulty whatever. Also on the question of the four weeks' notice, in one particular case where it was introduced, the system was agreed with the trade union, and the first week it went into operation there was a bank strike. I cannot say exactly how it was done, but those employees were paid by cheque during the whole of the bank strike and it worked to their disadvantage.

One case has assisted in savings, because the banks were co-operative. It is in their interest to get more accounts. A system was operated so that employees had two accounts, a savings account and a current account, and the employees were able to get interest on any money they did not use. There are several gains in this Bill. I welcome it. I do not see the necessity for taking any more precautions than are in the Bill already. They are sufficient. We have to accept the practical situation that this is a tremendous gain to an employer if it operates. He will see that it operates to the benefit of the employees, because he will want it to operate.

Mr. Lambert

I welcome this Bill on behalf of the business community, and particularly large firms. As we know, the professional bodies such as the FUE and the ICTU have been pushing this for many years. Indeed, I tried to get it as far as 25 years ago but the main resistance was because of what Senator Brennan mentioned, the confidentiality of the wage packet. The manual worker could give to the housewife as much as he thought fit and only one person knew what was in the wage packet.

I was delighted to hear Senator Fintan Kennedy's welcome for the Bill. I only hope its implementation will be smooth, because it would be regrettable if any unrealistic obstacles were put in the way of arriving at consensus.

We cannot ignore security. Everyone feels this. There has been too much talk about bank robberies but, with the enormous inflation now, you have the muggings and the bag snatching, and obviously they are growing with the amount of money that is in circulation. I hope all parties will agree to facilitate payment in other than cash in the various forms suggested under the Bill. As an evolutionary process, even an immediate basis of part cash part-cheque would be a development, particularly during periods of Christmas holidays and summer holidays where there is double or treble the amount of cash in circulation. Perhaps we could agree to pay in the second or third week in the form of cheque as a beginning. I should like to see a maximum of £20 in cash and the rest in cheque form to facilitate both employee and employer.

I am conscious that the Bill regularises certain procedures that have been in operation and I wonder will this facilitate, for instance, the deduction of union dues which I know has been pressed for so many years. I agree that the taxation system as it is now will obviously facilitate the documentation of the deductions. We have an example of this in our own pay forms which we get through the Seanad.

As regards bank strikes I would not be too worried. We have carried on without the banks on many occasions, and it falls to the larger firms to take the place of the banks. They will, obviously, facilitate many employees both of their own and other sections of the community in keeping cash in circulation. I welcome the Bill and I look forward to its rapid implementation as soon as possible.

Mr. Harte

I have a few brief words to say. From the trade union point of view, we are happy that the Minister has gone as far as possible in this situation. We have no problems at all in regard to this Bill. It regularises situations that are illegal at the moment. Where people are being paid by cheque. In our own tinpot way we negotiated our way through certain situations, maybe not in accordance with all the conditions laid down in the Truck Acts, but we did it in the interests of security. Senator Lambert referred to large amounts of money lying around. Generally speaking, at the moment most people would be happy to be paid by cheque. There were a lot of problems at the introduction of the system whereby certain payments were stopped at source through payment by cheque many workers felt that they were handing over their union connection or communication to the employer when they did not pay their union dues directly. Generally that attitude is gone now and we are very happy that the Bill has been brought in to regularise the situation. I thank the Minister again for accepting many of the views of the ICTU and the measures that are being taken. We are quite happy with the Bill.

Minister for Labour (Mr. G. Fitzgerald)

Ba mhaith liom mo bhuíochas a ghabháil leis na Seanadoirí as ucht an fháilte a chuireadar roimh an mBille seo. In thanking the Senators for their welcome of this Bill, I will make a few points in reply. First of all, Senator Cooney referred to the security aspects of this Bill. I say to him that, despite the broadening of my portfolio and the increase in my responsibilities in recent times, I am still not responsible for the portfolio of Justice and this is not a security Bill. This Bill is an effort to facilitate employers, employees, employers' organisations and trade unions for the payment of wages by non-cash method. It is a desirable step forward.

The Bill is deliberately very flexible in its approach so that through the recognised system of free collective bargaining that exists in this country we may see more and more advance and improvement in the payment of wages by cheque or other such methods. Some Senators suggested that perhaps I should police and monitor. This is not the approach either. But I and all of us in this House should encourage as many people as possible to avail of the facilities now being afforded by this Bill.

Some speaker said in the other House that we cannot eliminate all the movement of cash, but if it does reduce the movement of cash and as a result reduces some of the targets of these robbers, then the Bill will obviously be a benefit in that respect as well. Speaking in the other House, I condemned people who engage in that type of activity, but I said that this Bill was to remove anomalies that had resulted particularly from the passing of the 1927 Act.

I thank the Senators who welcomed the Bill. It is very desirable in social legislation of this nature that the Minister for Labour sets out to achieve agreement between both sides of industry. He does not always get it, but on this occasion we worked out a formula for legislation that was acceptable to both sides of industry. This was a welcome development.

Senator Cooney asked some questions. I will try to reply to some of them. He asked what I meant when I referred to other items on a document. I was saying that the document could form part of a broader agreement embracing other items such as productivity deals and so on. That is the point I was making there. The bank strike provision was raised by Senator Cooney and others. That is a contingency situation and I have full faith and confidence in the ability of the employers' and trade union organisations, the employers and employees, to meet a contingency situation if and when it arises. We should not legislate for the more positive and normal activities of the industrial world.

On the question of the individual opting out, an individual cannot opt out of a union agreement freely entered into under the normal democratic rules of his union. This is understandable in this or any other situation. Any digression from that would not help in the industrial relations field. Of course, he may exercise his rights in the case of absences from his normal place of work due to illness or for any other reason.

The four weeks was referred to by a few speakers, I do not believe that four weeks is too long in this situation. There must be some order. If, for example, a particular system of payment is agreed on and is put into operation, anything less than that would create extreme difficulties and perhaps call for a change to a different system. I have discussed it with both sides of industry who accepted entirely the four weeks and it would be undesirable that we should effect any change there.

Senator Hussey asked about figures of payment in this country as compared with others, but we do not have figures available. In addition to encouraging and enabling people to do something positive for the future, we are also legalising some things that have happened in the past, as Senator Harte said. Agreements have been entered into on behalf of non-manual workers and the passing of this legislation will give official recognition to and legalise the situation and we all agree that that is highly desirable.

In conclusion, I thank all those who made contributions here for the welcome given to the Bill and I add my voice, and I hope that Senators will continue to add their voices, to encourage the change over to non-cash methods. Basically the Bill is flexible legislation that enables employers and employees to go ahead with non-cash payment.

Senator Cooney and others raised the question of the cashing arrangements. Senator Brennan made the point about staggering the payment of wages and that quite a lot of wages are paid now on days other than Friday, perhaps not for the reasons he intended, but for people's convenience. In regard to our banking institutions we seem to be well serviced in this country. At this stage I do not intend to go into a lot of detail but the statistics are that there is an associated bank office for every 2,800 persons. Therefore, we are much bettered serviced than on the European scene generally. As Senators are aware, under section 3 of the Bill there are quite a number of options open on the non-cash method of payment. I do not believe that that would be a cause of difficulty to any significant number of people. The flexibility within the Bill protects those for whom difficulties may be created. Being a person who represents a scattered constituency, both urban and rural, I realise that in some rural areas there may be some difficulties but I believe that today they they are not insurmountable.

I thank the Seanad for welcoming the Bill and I would ask for all Stages today, if that is possible.

Question put and agreed to.

Agreed to take remaining Stages today.