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Seanad Éireann debate -
Wednesday, 3 Feb 1988

Vol. 118 No. 7

Worker Participation (State Enterprises) Bill, 1988: Second Stage.

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

The Bill now before the House translates into action the Government commitment in the Programme for National Recovery to provide legislation to facilitate the introduction of worker participation at sub-board levels in State enterprises. The Bill also extends provision for worker director elections to employees in two further State enterprises — Aer Rianta and the National Rehabilitation Board. In addition, the Bill makes a number of amendments to the Worker Participation (State Enterprises) Act, 1977.

The Bill is broadly similar to that introduced in this House in December, 1986. That Bill lapsed from the Seanad Order Paper following the general election. I am confident that on this occasion the proposals before this House will reach the Statute Book.

It is 11 years since the Worker Participation (State Enterprises) Act, 1977, passed into law. At that time, there was considerable debate as to whether board level participation was the most appropriate starting point for worker involvement in our State enterprises. Some argued that shop floor level participation was the essential first step in any worker participation initiative.

In the event, the worker director legislation went ahead in seven major State enterprises. Subsequently, in 1983, provision was made in the legislation which established An Post and Bord Telecom Éireann for worker directors on the new boards.

The debate about the merits of different ways of promoting greater involvement of employees has continued. The elected directors have been critical of the isolation forced upon them by the absence of well designed structures and appropriate representative arrangements at sub-board level. In 1980 the then Minister for Labour published a discussion paper which emphasised the importance of participation below the level of the board. The Commission of Enquiry on Safety, Health and Welfare which reported in 1983 proposed an integral role for employees in enforcing safety and health standards in the workplace. In 1986, the Advisory Committee on Worker Participation examined and reported on the scope for development of employee participation at sub-board level in different types of work organisation.

When I assumed office as Minister for Labour, I found that there was a fair body of expert opinion as well as a published Bill which together identified a variety of options for progress in the area of worker participation. The ground work had been done. My task was to take up some of the proposals for action and bring them to fruition.

The purpose of this Bill is to underpin the development of worker involvement below the level of the board in the semi-State sector. There are 39 State enterprises listed in the First Schedule of the Bill.

All of these enterprises are covered by the sub-board provisions. Some of the enterprises listed have made some progress with participation. Many of the enterprises have yet to consider joint consultation; this Bill should help them to take the first steps in the participative process.

We need to legislate in this area in order to stimulate change by means of a concerted effort on the part of management and employee at enterprise level. There has been a tendency on the part of those enterprises — both in the public and the private sector — who have pioneered new forms of employee involvement to keep their experience very much to themselves. I have spoken before of the need to shed more light on the new forms of work organisation and of co-operation which have been developed in this country. I see this Bill as a useful catalyst in this context.

The Bill gives to employees in each State enterprise the right to initiate arrangements for sub-board participation. The enterprise and the representatives of its employees are required to devise between them mutually acceptable arrangements for employee involvement following a request from a majority of employees. Although the Bill provides for a direct initiative by employees within each enterprise, it does not interfere with the freedom of management to develop its own proposals and to approach employee representatives about the development of sub-board participation.

It is up to the employee representatives and the company management to work out arrangements best suited to their organisation in each case. The whole range of options — from direct to representational forms of participation and from the highly structured to the relatively informal — are accommodated within the legislative framework.

I hope that enterprises will be innovative in their use of the legislation. The Bill does not seek to impose a uniform framework. There is scope for a wide variety of different practices providing always that the arrangements made are acceptable both to the enterprise and to the workforce. This flexibility in the legislation ensures considerable freedom at enterprise level.

The agenda for participation will have to be decided between the enterprise and its employees. I expect that at the outset some enterprises may opt for a narrow range of subject areas. As confidence grows and the level of trust develops, further subject areas can be brought within the participative process. In the ESB, for instance, where all the unions and management have reached agreement on the establishment of structures for worker participation, it was accepted by all concerned that they were engaged in a long term process and that some objectives would only be gained by years of genuine effort by both sides.

Although flexibility is the keynote, some critical elements are essential to the evolution of participation and these are set out at section 6(2) of the Bill.

The Bill requires the exchange of views as well as the exchange of clear and reliable information between the enterprise and its employees; the communication in good time to employees of information likely to have a significant effect on their interests; and the distribution to all employees of views and information arising from the participative process. These are the basic requirements. There are, of course, many issues on which management and unions could make progress for mutual benefit, by sharing information and joint discussion, leading to better decisions for all concerned.

Another feature of the Bill is the extension of worker director arrangements to two further State enterprises. These are Aer Rianta and the National Rehabilitation Board. The 1977 Act gave employees in seven commercial State enterprises the right to elect worker directors in numbers equal to one-third of total board membership. Aer Rianta is another commercial enterprise and will be accommodated within the framework established in the 1977 Act.

The National Rehabilitation Board is the first non-commercial State enterprise to be brought within the general arrangements. The original formula of reserving one-third of all board places for worker directors was framed with commercial boards in mind. I believe that greater flexibility is necessary to take account of the circumstances of the non-commercial State bodies. Employees are only one element among the diversity of representative interests to be accommodated on these boards.

In deciding the level of employee representation on boards of this kind it is important to maintain the balance of representational interests and to ensure at the same time that the board remains an effective body. These considerations can be judged only on a case by case basis. As a result, the Bill permits the Minister for Labour to vary the number of worker directors below the one-third arrangement by order — subject to a minimum of two worker directors.

There are a number of other amendments to the 1977 Act which I would like to bring to your attention. The 1977 Act was an experimental measure. It did not provide scope for extending its provisions beyond the seven enterprises designated in the Act. As a result further developments in board level participation were entirely dependent on voluntary initiatives or on special legislative developments — as in the case of the establishment of An Post and Telecom Éireann.

This Bill provides for the extension of board level participation to further State enterprises without recourse to primary legislation. It empowers the Minister for Labour after consultation with other interested Minister's and with the approval of both Houses of the Oireachtas to designate further enterprises for worker director elections.

Section 9 of the Bill will allow the employees of company subsidiaries to take part, subject to very precise requirements, in elections to the main board. Their inclusion in the overall electorate is a matter for the State enterprise concerned.

The Bill provides that any proposal for their inclusion must be sent in writing to the Minister for Labour and the views of staff representatives must be communicated to him at the same time.

It is only at this stage that the Minister for Labour, in consultation with other Ministers concerned, would consider bringing the employees of the subsidiary into the overall electorate for the main board. In any event, a draft order to give effect to the proposal would require the approval of both Houses of the Oireachtas. I am aware that this provision has given rise to concern particularly in relation to the position of overseas subsidiaries. I appreciate the difficulties which might arise. I am reviewing the options in this area and will return to the matter in more detail on Committee Stage.

The other amendments I want to mention are more straightforward. I propose to extend the term of office of worker directors from three to four years. This change follows on requests for a period of office longer than three years, both from worker directors and from the boards of some designated enterprises.

There is also provision that worker directors who cease to be employees of the State enterprise should relinquish board membership. Worker directors are meant to be just that — employees of the enterprise who have a seat on the board. It is reasonable to expect that they should give up board membership when they retire or resign from the enterprise.

The provision ensures that employees are represented at board level by a fellow worker and is particularly apt at this stage because of the extension from three to four years of the term of office of worker directors.

Worker participation can make a positive contribution to improving the relations between management and employees. I see worker participation as a model for a new maturity of purpose by Irish workers and management. Central to this is the establishment and maintenance of a relationship of trust and co-operation in the workplace. The present generation have the education to assess and evaluate economic and business information. They have grown up in a "right to know" society. Yet, the workplace has hardly changed in my lifetime.

The focus on the development of sub-board structures in the Programme for National Recovery is a positive step which, I believe, calls for reciprocal initiatives from employers and trade unions. The programme is about concerted efforts on the part of all interests based on a commitment to the provision of employment and to the better use of natural and human resources. I hope this Bill will help to strengthen the spirit of co-operation which has been a feature of our State enterprise.

I commend the Bill to the House.

I am pleased to welcome this Bill into the House. Its objective is to support the concept of industrial democracy in the widest sense and to enable workers to know that their views and their experiences will be taken into account in important stages of management planning.

It is, indeed, regrettable that there has been a delay in introducing this legislation. I know that the same view was expressed here in the Seanad in December 1986 when the Coalition Government introduced the previous Bill which was very much the same in its objectives as the present Bill. Unfortunately as the Minister pointed out, because that Bill had not completed all stages in the Seanad before the election, it did not go on the new Dáil Order Paper and so we have to start from scratch again. I must laud the confidence with which the Minister assured us that this Bill would not suffer the same fate as the last one. However, I do not believe there will be any serious disagreement from any side of this House on the progress of the Bill. All parties not only agree with the proposals in legislation such as this, but at various times in Government have introduced legislation in the general area.

In this context I would like to comment on the work of the Advisory Committee on Worker Participation whose report was presented to the previous Minister for Labour in October 1986. It is a report which, although the committee had a restricted time in which to work and to bring forward their report, is extraordinarily comprehensive in its range. It gives a very good brief and background to the whole movement for worker participation in this country and elsewhere and has even contributed an evolution in Ireland of the movement. We see from this section of the report that, while the first discussion or examination of industrial democracy in Ireland happened in May 1967, it was not until June 1976 that the first Worker Participation (State Enterprises) Bill was introduced to the Dáil by a previous Coalition Government and this legislation became law in April 1977. So we can see that this move towards the very desirable participation of workers on company boards is a slow process and we have to be suitably grateful that this legislation is now before the House.

This Bill, I believe, represents a balance between State intervention in the interests of establishing basic rights and representations and the provision of voluntary mechanisms which leave it up to workers to decide whether or not to exercise those rights. The Bill before the House will support employee influence in companies without regulating or setting down any absolute rules in detail on how decisions should be made and what decisions should be reached. Of course, there are a number of different patterns or forms in which employee participation can be effected and, as the advisory committee reported, it would be difficult to pick a way through the many forms of human interaction which bear the name of employee participation.

The application to Ireland and the experience of other countries lead to a number of general conclusions. Ireland has remained isolated from the widespread interest in other countries in the development of new forms of worker participation and management. Hence the first need was to awaken realisation among people here to the possibilities and the need to move away from centralised systems of managerial domination towards the involvement of workers in the organisation of productive activities. It was necessary to overcome the opposition among Irish employers and to secure support for the introduction of appropriate legislation. It would be necessary for the trade union movement to accelerate the process of developing improvements in structure in their service to their members, and to familiarise themselves with the solution discovered in other countries. To quote from the Seanad report of 10 December 1986 the Minister, Deputy Ruairí Quinn, introducing the Second Stage of the Worker Participation (State Enterprises) Bill, 1986 said:

The worker director experiment, initially confined to the seven State companies covered by the 1977 Act and subsequently adopted in An Post, Bord Telecom and ACOT... has been judged largely successful. Nevertheless both management and unions have been reluctant to consider the effects of the experiment and developments at lower levels in the enterprise. For their part, the elected worker directors recognise the need for more support in reporting back and in maintaining contact with other employees. Across the State sector generally the information issue has been tackled in a piecemeal fashion. The outcome in all fronts has, by any standards, reflected limited success, limited awareness and hardly any integration.

This Bill is a further recognition of greater awareness in industrial relations and represents a recognition of the improvement in the education of workers today. Although the class of distinction, that the "them and us" syndrome of years past, is fading quite fast, there is still too much evidence around to suit fair-minded people who believe that workers should have a voice and a role in decision-making and in corporate planning. It is valid that the State not only should take a lead in this matter, but needs to be constantly aware of the further development of the concept of worker participation and the research and development and training requirements necessary to enable the worker directors to integrate fully and to meet expectations of them.

At present, when this country is going through a painful and difficult era in regard to job losses and inability of the economy to provide sufficient jobs to meets the needs of the young expanding population, it is vitally important that we continue to explore all avenues which will lead to better industrial relations and exploit to the full the talents and skills available whether they are in the ranks of management or in the ranks of the workers. There are many advantages for any organisation in tapping and using the resources of workers and putting them into effect in the heretofore rarefied atmosphere of the boardrooms. It has got to be to the advantage of any corporation to have at the highest level the value of actual experience, actual insights and actual knowledge of the operation of a plant, firsthand experience of the technical and human resources operating at production level.

Added to this must be the firsthand understanding and experience of workers of the industrial relations process within their company. Good industrial relations machinery has got to be a fundamental part of the co-operative and harmonious working of a company. It is easy to see that this can be had to the best advantage through the involvement of the workers on the factory floor. Overall the natural intelligence and ability of the workers is an important dimension.

The experience up to now is that the workers' representatives have met the challenge of this new role, and have made a very positive contribution. But then it cannot be easy initially for them, moving from the work environment where for many years they would have been familiar with the rules, practice and expectations and have had the support and the companionship of their peer group, into a totally new and different environment of management. Not only do they in effect have to cross into new work terrain which would have been strange and maybe even hostile to them in the past, but they are also required to master aspects of a strange agenda, which they may not have the ready skills or background to cope with, such as financial statements, or planning, or economic analysis.

The experience has been that the role is seen by directors in a very serious way, and can mean that these directors will very often take more of an intense interest in matters coming up for discussion than, perhaps, would the outside directors. Nobody could underestimate the enormous responsibility involved in this role, one that requires the members to set aside their union differences and to develop a commitment on the one hand to the company and maintain their commitment to their constituency of workers. No one can doubt that it is a difficult if rewarding and important position because it may be fine to be a director when the company is making a profit and forging ahead in a worthwhile way and with a lot of good news. It is a completely different story and it is not so easy when the same company is going through a difficult time and may need, for instance, to negotiate to close a plant down or to relocate, or seek necessary redundancies.

The need to ensure that the best interests of all concerned are accommodated indicates the importance of the development of the sub-board structures. The sections in this Bill which deal with the machinery for establishing these sub-board structures are comprehensive and clear and when established should contribute to greater understanding of issues and the possibility of resolution of differences with representatives and management and workers sitting down together for consultations, mutual understanding, hopefully, and decision making. This will mean that the worker directors will not be working in a vacuum but will have dialogue and broad agreements on issues for decisions.

With regard to section 9 which provides for the optional appointment of worker directors to subsidiaries of companies, as the Minister admits some disappointment was expressed that this is being maintained on ministerial discretion. I would like to ask why it was not possible to have agreement for the company and the union to opt in or out as best suited them. It has been suggested that some pretty robust lobbying went on behind the scenes in that event.

Further, on section 10, I would like to remind the Minister that this section increases to four years the term of office of worker director members and replaces the provision of a three year term of office in the principal Act. I would like to ask the Minister if he sees this provision being extended to the Telecommunications Act, 1983, which when set up provided for worker directors but catered for a term of office of three years only. How does the Minister intend to deal with this matter?

Finally, could I draw the Minister's attention to section 13 which amends, replaces and inserts certain interpretations in section 1 of the principal Act. The definition of "employee" in the principal Act is amended to include part time staff working at least 18 hours a week. I would like to suggest to the Minister that this unnecessary restriction causes me grave reservations, certainly about the 18 hour threshold. I feel this threshold is unacceptable in general, but I would say that it is specifically unacceptable because it discriminates against women workers. I question whether this section is included just because it has become a feature of legislation in a whole lot of other areas where I accept there would be financial or social welfare consequences or implications. Is it really necessary here because these issues are not of consideration or implication?

I suggest there is no rationale in this event because there are no such consequences. I propose that the determining qualification should be a contract of employment, regardless of the hours worked. I suggest that, if you examine the statistics relating to the number of female workers in the work force who are temporary as against the male workers, you will accept that this provision of an 18 hour threshold treats women less favourably than men. I will give an example. The figure is 13,900 males regularly working part time as against 43,800 women. I suggest that perhaps the Minister should examine this provision again more carefully and, at the same time, he might be moved to set a market for the need to increase the number of women at director level. This could be done, in my opinion, by recommending that in the nomination and selection process of worker directors, or members of a board, regard should be had to the male-female balance. I believe this could be done and it would be a legitimate criterion to use.

Finally, I would like to say again that I welcome the Bill as a realistic move towards greater democracy in the work place. I know it will change procedures and practices, but I trust that it will also contribute to changing outmoded and conservative attitudes which are still too prevalent in our society. In the face of continually changing patterns and work relations in the modern industrial community, caution, tradition and fear can become blinkers which serve to inhibit progress and development. I trust that workers in the various State enterprises will recognise what this Bill offers, and take advantage of all the opportunities it brings to allow them to become involved in the decision-making process at the enterprises in which they work.

I trust, too, that management involved at all levels will have the necessary foresight and responsibility to see these initiatives in a positive light. Their support is vital. It goes without saying that, in the last analysis, the best guarantee of success and steady expansion of this concept is in the effective and meaningful contribution by those workers who now are members of the boards of their companies.

This is not a contentious Bill. I warmly welcome it. I would like very briefly to make some observations on the general theme of worker participation. For that we can look at European experience with different economic and social systems. The experience elsewhere suggests that worker participation is, indeed, worthwhile, that it works and that it leads to an improvement in industrial relations. In that context I think one should make the point that the older autocratic ways of running a business have failed to draw out the energies and skills and potential of workers to anything like what is available if the conditions are right.

Studies of better run businesses indicate that the way to release those energies and to provide greater satisfaction in the work place and to help in raising the level of productivity and efficiency is not by confrontation or recrimination but rather the emphasis is on putting the relationship on to a new basis which will involve not just management but all the workers in the enterprise in decision-making across the range of company activities. Such a change in outlook and attitude can only come about as a result of giving workers a real as opposed to a token say in making decisions. Experience in other countries does, indeed, suggest that this type of real say will release energies and abilities which may be frustrated or not used otherwise.

The original Worker Participation Act in 1977 was enacted in different economic times. Those were the days of growth, compared with the more pressing and demanding times in which these State enterprises must operate today. The aim of the original Act was to set up arrangements for board representation in a number of major State enterprises in line with developments in other European countries. The initiative in introducing participation at this level was taken by the Government because it was considered that a legislative push was necessary to get the system into place. Lower growth rates and intensive international competition for goods and services characterise the present time but, of course, it can be argued that the relevance of worker involvement, including board representation, is now more important than ever.

The current financial stringency and the challenge of national recovery are making new and fresh demands on our State enterprises today, so that co-operation between management and workers in achieving enterprise objectives is particularly important at present. Under the 1977 Act worker directors enjoyed the same status as other directors. I think it is worth saying that again, in that the same rules of company law applied to them in respect of disclosure of interest, confidentiality and voting.

This, in turn, raises the question as to whether worker participation can assist in job creation or contribute to it. Are the benefits from board membership worth the costs in time and effort invested by both sides? Can the advantages be quantified? Unfortunately, I have to say that we do not have sufficient evidence to be sure that this is the way forward. Nonetheless, there are encourging signs that the board representation experiment has, indeed, worked.

Preliminary research was conducted by Murphy and Walsh of the Irish Productivity Centre in 1980 and the results were published at that time. This study reported on the attitudes of worker directors to a range of issues at the time of the first elections or shortly thereafter. Among the findings they reported were that the worker directors experienced little difficulty in fitting into their new roles; that support for them was forthcoming from other board members and from management and supervisors but rather less enthusiasm was found among trade union officials and shop stewards.

The IPC study showed that trade union officials were concerned that the collective bargaining process should not be adversely affected. Shop stewards felt that there was insufficient feedback from the worker directors. The worker directors themselves, in the same study, showed concern about the need to develop sub-board structures to link them with their constituencies. To the extent that the Bill before us will contribute, as it undoubtedly will, to improving communications between the board and lower levels of the organisation, then it is particularly welcome.

The point I would make about the experience to date is that there is a need for a further study or an updating of the experience of worker directors and that such a study might be funded by the Department of Labour. The findings should inform policy making that much better than is possible at present.

I touched a moment ago on the institution of collective bargaining which is concerned with the direct negotiations between employers and trade union representatives on pay and conditions. Given the dominance of collective bargaining in this country it is not surprising that the IPC study in 1980 found a lack of enthusiasm by trade union officials and shop stewards for the worker director system. Irish trade unions have, for many years, catered for worker interests through collective bargaining through this direct negotiation process with the emphasis on economic issues — pay and conditions — as opposed to other issues affecting the enterprise.

Trade unions argue, with justification, that much has been achieved for workers through collective bargaining without having to rely on other forms of participation. For their part, trade union officials and shop stewards will continue to ensure that worker directors and sub-board structures will not conflict with traditional collective bargaining arrangements. It should also be pointed out that management, too, have long experience in negotiating with trade unions in the collective bargaining context. The adversarial relationship which collective bargaining implies has been understood by both sides to exclude worker representation on the board.

Over the years management have opposed worker representation at board level as they have viewed it as being incompatible with the collective bargaining process. The traditional management argument has been that a conflict of interest is inevitable if workers are on the board which, in turn they argue, leads to ineffectiveness in decision-making at board level. This obviously raises the question as to whether the fears of trade union officials as well as senior management have been justified by the experience of worker directors in State enterprises. Trade union anxieties have been largely catered for in that trade union activists have typically been the successful candidates in the various worker director elections. Moreover, most of those elected continue to hold some trade union office which, in turn, serves as an important link between worker directors and their trade unions.

Like other sectors of the economy, the commercial semi-State enterprises have to work for economic viability. This is never easy. For several of these enterprises it is that much more difficult in the harsher economic climate of the late eighties. Nonetheless, worker directors on boards have the potential to make a very special contribution. From the evidence we have available, limited as it is, that is the case. It must be rememberd that worker directors have probably more at stake in an enterprise than any other director. They earn their livelihood from these enterprises. They have a detailed knowledge of aspects of the working of these enterprises. They have a very special interest in the success of the State enterprises where there are directors. It is, therefore, up to the worker directors, together with other board members and managment, to move towards greater co-operation in the interest of overall enterprise success to their mutual advantage.

With regard to the sub-board structures worker participation at board level is not, by itself, sufficient to ensure an extension of industrial democracy. What is needed, of course — and the Bill addresses this — is an inter-related structure of participation at all levels of the enterprise. A well developed structure below the board is clearly vital. Experience elsewhere indicates that it is up to each company to work out its own programme for the extension of participation at various levels. The Minister emphasised in his opening speech that the two sides should work out the arrangements best suited to their own organisation.

The question is not so much to build upwards from the bottom or work down-wards from the top. The task is rather to build on existing structures, so that a complete system evolves fitted to the particular needs of the company concerned. The provision, therefore, and the idea behind the Bill of flexibility, is praiseworthy and eminently sensible in this regard.

One of the main objectives of the Bill before us is to facilitate the introduction of sub-board participation arrangements in a range of State enterprises, as I have said. In this context I would like to compliment Fr. Tom Morrissey and the members of the Advisory Committee on Worker Participation, who produced their report in record time, and which has thrown considerable light on the subject of sub-board structures and on participation in general.

In the past, unfortunately, there have been experiments with sub-board structures, such as work councils. Too often, these councils dealt only in trivia. A noted writer in the field said that their work was confined to discussing toilets and tea towels. There is every prospect now that this legislative push will help the development of sub-board structures, that issues like company plans, manpower policy, budgets and so on will find their place in a serious way on to the agenda of the sub-board structures when they are put in place.

It is clearly important before these arrangements are worked out that there should be full consultation between both sides. In particular, I would urge that line management should have a substantial input at the design stage of these structures because they are the people who will be needed to actively involve themselves in the working and operation of these sub-board arrangements. Trade unions for their part will want to see the sub-board structures to be founded on existing trade union structures. It goes without saying, therefore, that those arrangements which complement collective bargaining rather than replacing it offer the best prospect for success in the Irish situation. This should not, however, — I am now referring to the pre-occupation of the trade union representatives to ensure that it is built on trade union structures — exclude the right of management to communicate directly with their employees on various issues if they consider it necessary.

People who care.

This kind of dual communication may well be necessary to get the fullest understanding among the workforce and to underline the importance of full understanding of the company objectives by both. In those enterprises where worker directors already exist, the same worker directors could play a very valuable role in advancing the establishment of sub-board structures precisely because they are on the board.

Sub-board arrangements should enjoy a higher profile within the organisation and a greater degree of commitment from other board members because they will have the backing of worker directors. The problem with sub-board structures in the past is that there was not the commitment from the top to them. Such a commitment from the top of the organisation should help to ensure that the sub-board arrangements are taken seriously by all concerned.

Section 6 of the Bill outlines the essential features of the sub-board participative arrangements which will be drawn up jointly between the State company concerned and its employees. These concern first, a regular exchange of views and information between management and employees concerning matters which are specified in the agreement; secondly, the giving in good time by management to employees of information about certain decisions which are liable to have a significant effect on employees' interests and finally, dissemination to all employees of information and views arising from the participative arrangements.

I have been on successive Joint Committees on State-Sponsored Bodies. We have examined these commercial semi-State bodies over the years. One such body was Fóir Teoranta, on which we reported in 1981. It became evident in the course of the evidence that we got from the top management and chairman of that company that those manufacturing companies that were in trouble — up to that point at any rate — who sought financial assistance made untold efforts not to disclose the plight of the company to anybody, not even their bankers. The point I am making is that disclosure of information could make a very significant contribution to the rescue of companies. The employees themselves are key stakeholders. They have every reason to want the survival of companies, precisely because their livelihood depends on it. Putting more emphasis on information disclosure and on informing employees in good time is to be highly commended and something that I hope will be implemented in practice when they are putting their participative arrangements in place.

Detailed comment on other sections of the Bill can be left more appropriately to Committee Stage. However, I wish to refer to section 13 which changes the definition of "employee" in the Principal Act to include part time staff. Senator Fennell has referred to this. There has to be some limit on hours and 18 hours is what is put forward here. The need for part time workers arises for a number of reasons: there are cost considerations; new technology has made a significant impact on workforces and has led in turn to this evolution of part time workers.

A number of studies have pointed to the evolution of a dual workforce in future. It is envisaged that there will be a critical workforce or core group who will be responsible for carrying out the more specialised activities of the organisation. Side-by-side with this highly qualified, critical, workforce will be the peripheral workforce. These peripheral workers will be working part time, or will be sub-contractors, or workers who are on fixed term contracts. The number of part time workers in the Irish economy is growing, following the introduction of new technology and, indeed, following the shortage of full time employment. This section addresses this issue in a fair and legitimate way, in that it provides for board representation for part time workers, recognising the reality of this change in the composition of the workforce as between full time and part time people. I welcome this particularly.

I should like to turn briefly to the provision for worker directors. Aer Rianta and the National Rehabilitation Board will now be permitted to proceed with their elections for worker directors. I wish to comment on Aer Rianta, because I am familiar with the exceptional initiative which unions and management in that company have shown in identifying what participation is all about. Their Industrial Democracy Council has addressed participative issues in the company for some time past. A more recent development has been the formation of a joint working group of management and Industrial Democracy Council representatives to recommend future initiatives in the area of participation. It has been stated company policy in Aer Rianta for several years past to encourage staff participation in the workplace and generally to promote an open style of management in conducting the affairs of the company. The purpose of the joint group is to examine the future possibilities for participation at below board level in Aer Rianta. The Government initiative in the Bill will support the initiatives already taken in Aer Rianta, while the skill and experience gained by management and workers in the company to date will provide both with the ability to contribute to decision-making at various levels.

I specifically want to put on the record the excellent practices in Aer Rianta by both management and trade unions in preparing for worker participation. They have eagerly awaited the enactment of this legislation and their efforts in preparing in advance will serve them well when the board members are duly elected.

One should not make too big a deal of the Bill and I do not think the Minister would do that either. Initiatives at national level in the area of participation can only provide a framework for action on worker participation. They are no substitute for the initiative and enthusiasm which management and workers in the State enterprises can themselves provide. These are the essential ingredients. Joint initiatives at company level only succeed when management and employees become convinced of their ownership of the new development and the commitment to those structures and to participation then follows.

Worker participation is, of course, no panacea. We need to be realistic about what worker participation can achieve. Participation on its own is not a solution to job security or low productivity. Progress in participative arrangements requires patience, time and discussion. It is a matter of urgency, however, in the difficult economic environment in which enterprises operate today for management and workers to identify the common ground, as opposed to confrontation, between them and to take it from there. Worker participation with the emphasis on co-operation should help to bring about a climate of trust which, if achieved, should make a significant contribution to the solution of the pressing problems facing the State enterprises concerned in the Bill.

Genuine participative arrangements should enable management and workers to co-operate together to achieve greater productivity and prosperity for their enterprises. I warmly welcome the Bill and congratulate the Minister on having it before us today.

I certainly do make a "big deal" about the Bill and I warmly welcome it. I congratulate the Minister for bringing forward this legislation. It is worthwhile putting on the record his own commitment to good industrial relations and fair and proper developments in the whole area of industrial relations. He has shown that commitment, both in a physical way as well as in the legislative way.

As I have stated, I welcome the Bill which is a good one. It is positive legislation. I am happy with 90 per cent of it but I would say that it could go a bit further in various areas — I would always be saying that, anyway. There is no such thing as perfect legislation——

It was you who said it.

I am an honest person. I am aware of my own inadequacies in this area. I am glad Senator Hillery made the point of worker involvement. I will deal with the question of the flow of information later. I have said time and again that nobody has a greater vested interest in the efficiency and in the proper running of a company than the workers involved in it. For anyone to suggest at any time that workers would take a decision which would be bad for the company is incomprehensible to me. I just cannot understand it. I will deal with what I would consider to be a point of tension in a moment but certainly a worker has an investment in the company which he or she cannot walk away from — not in the way that the owner can, in the sense that the worker is selling his or her labour and depends for a living on getting paid for that labour at the end of every week, whereas the owner of the factory can perhaps liquidate, sell off and walk away with the profit. It would be fair to say that in many ways — and looking at it from many different perspectives — the worker would have more of a vested interest in a properly run company or structure than the owner.

There are two things involved: the worker is interested in work and the owner is interested in making a profit. If we are honest and reflect on and recognise those two points of view, then we come to what I consider the only point of conflict. "Conflict" is, perhaps, the wrong word to use as we can look at it as "tension" in this case. In other words, the worker is interested in continuing in employment and the owner is interested in continuing in profitability. The good thing about those two objectives is that they can both be reached by going down the same road.

One of the reasons this Bill can be so much welcomed in the national interest is that, if a factory owner, or the owner of a company, or the board of a company, realise that they can be more efficient by getting rid of a couple of hundred workers and if the worker directors on the board say: "We are going to fight against that because we feel that efficiency must be balanced with the national need in terms of employment," the State and the nation are served in that way. If, by putting those opposite arguments and through that tension of different points of view we find a middle line of progress the national interest is well served in that particular area.

I regret that we have not yet seen in legislation or proposed legislation the extension of this concept into private industry, I recognise that it would not be proper to include it in this particular legislation but I am saying to the Minister that I urge that this be looked at and legislation be brought forward as quickly as possible.

Senator Hillery referred to the problem that has come up time and time again in Fóir Teoranta, the idea of creating surprises for the workers. There should be no surprises for the workers; they should know the state of their industry; they should know the state of their work area and they should know the problems. We can apply that to any place. I have this great belief that if you put 15 people around a table and give them the same set of difficulties they will come very close to finding the same road to the solution whether they be directors, workers or whatever they are in the company. We should have confidence in people and give them the information, seek their wisdom, seek their experience and put it all into the equation in order to find a solution. That is the great positive thing about this legislation — that we are finding a way of tapping the experience and the objectives of the workers.

I would also like to be associated with the remarks of the previous speakers who referred to the Report of the Advisory Committee on Worker Participation. It is certainly a very useful document. It is the groundwork on which this legislation is based. It is the positive body of information on which we make our decisions about this area. We should place on record our thanks to the people who participated in that.

I would raise one point on that through you, a Chathaoirligh. One of the recommendations of this report was for a special participation council and agency. I would like to see that covered in the legislation and perhaps the Minister will respond at the end of this debate and say whether he would envisage that as new legislation or something which might be added to this or something which he will bring in separately or something to which he is opposed. If he is opposed to it perhaps we will hear the reasons for that. Apart from the reasons given here in the report itself in its favour, there is another reason. When any new structure is set up, when any new area is being developed we need very much to share the experience of the participants. The worker directors in Bord na Móna might have a completely different experience from the worker or other directors in Aer Lingus. It would be useful for them to meet to discuss and share ideas — I am not talking about discussing the affairs of the company; I am talking about the broad general terms and principles by which they work — and by sharing their various experiences and general difficulties in principle that they would then develop a consensus and maybe establish procedures which could be of use to people who could learn from the shared esperiences. It would be a very positive way forward. I know that the Government are not over-enthusiastic about setting up any sort of councils of a national nature at the moment but that is another day's work. Perhaps legislation could be introduced in that area at a later date.

I hope I am misinterpreting and misreading Senator Hillery's speech when I get somehow from him the idea that the trade union movement and trade unions in general would be in any way supportive of inefficiency or slackness or low productivity. That is not what we stand for and certainly in my discussions with various unions about this legislation — I discussed it with the ICTU, with the Post and Telegraphs workers union and with worker directors themselves — and from my own experience I can assure the House that I totally disagree with such a suggestion. I think we pull up slack and all of us have the same interest in doing that and therefore we stand for——

When he reads the record the Senator will see that I implied no such claims in relation to trade union activity.

I think the record will show that Senator Hillery gave the impression that in some way trade unions might be opposed to high productivity. I think that will be quite clear in the nuances of what he said. However, we will read the record and discuss it at a later date. For the record, we are in favour of effective, tight participation and the highest levels of efficiency and productivity.

It always worries me when I hear people talking about the problem of the trade union structure being too close to the structure of the company and that management should always retain the right to communicate directly with workers. Those are words which we heard, I suppose, in the first place from Mr. Edwards and the coal board and from various other people over the last number of years. It did not get anybody on any side anywhere. Workers will choose like any other group the democratic structures which they want to be part of. This particular Bill makes that very clear in its reference on a number of occasions to 15 per cent of the work force.

In fact, if anything, this Bill is weighted against people who would wish not to participate in trade unions. I am saying, for the record, that they have allowed within this Bill workers to group outside trade unions and that where 15 per cent of them can get together they can nominate people for the elections. I think there is enough of protection, if that is what Professor Hillery is referring to, or what the State want in this particular case. I would, of course, differ entirely from that. I would say that the best possible voice for the workers is their trade union, that this is the democratic structure that they choose and this is the structure by which they will indeed be represented. I suppose any democratic structure is dependent on its efficiency in representing the common good while at the same time making sure that no offence is given and that in no way are the rights of the individuals or the minorities offended. That is really the strength of the democratic structure and whether it be a national structure or trade union structure the same thing applies.

It is imperative that the trade unions be involved in this. I think the Minister would agree with me that the preparatory work done voluntarily in this area by the trade unions indicates their commitment. Certainly the example referred to of Aer Lingus is not the only one; this commitment has been shown all the way through.

At this stage I would like to refer to the fantastic programme of education and training and experience being provided by the training section of the Irish Congress of Trade Unions for worker directors. Anybody participating in the boards of any of the State or semi-State industries would agree that this has been productive and positive and, certainly, in all our interests.

I will be coming back to various areas like the part-time workers and the 18 hours which I have great difficulty with. I would say in passing with regard to the idea referred to by the previous speaker about the dual work force with the core of permanent workers and the outer area of part-time people, I would have a slightly different view on that. What we need is to have a flexible work force so that people will work in different areas and when technology catches up with their own area, they can move on to another area. It is wrong to suggest that instead of having full-time workers we would have part-time workers, because part-time means insecurity of tenure; it means insecurity with all the tension and the stress that go with that. It is totally alien to the history of this country where we have fought for so long for security of tenure and security of employment et cetera. I would disagree very much with Senator Hillery in that matter.

The principal legislation as referred to by the Minister was the 1977 Worker Participation Act. That was the Act which initially envisaged worker directors in semi-State companies. That idea was developed over the years and extended.

One of the difficulties which I will be referrring to and which the Minister has touched on in his speech has been the fact that in the intervening period, since 1977 and before this new proposed legislation of 1988, there was also the Posts and Telecommunications Act, 1983. That Act dealt with the setting up of worker directors in those two companies, An Post and An Bord Telecom. That has certainly raised a number of difficulties for us.

One difficulty raised with me by the General Secretary of PTWU, David Begg, was the fact that under the Second Schedule of this Bill the Minister may add to or remove from the list of enterprises in Part III of the schedule. It seems to include Telecom and An Post as ones that may be added to the present legislation. I would like to have clarified whether or not that is proper in the context of the 1983 legislation, or whether some amending legislation needs to be introduced at that point.

The 1983 Communication and Services Act which of course is nearly identical to the 1977 Act with minor changes in the area of election — I will refer to them again — needs to be addressed. One of the difficulties with the legislation is that I believe it is incompatible with the 1983 Act. Perhaps the Minister could explain this to us. The Minister made reference to extending the period of office of the worker directors from three to four years. Does this apply to the people in An Post and in Telecom who are covered under the 1983 legislation? Does it mean the Minister would be prepared to look reasonably at the question of amending that legislation as part of this legislation? I will be putting that forward. I do not think there is any argument against having a uniform system through all the semi-State bodies in that it creates problems if one is going to be treated differently from all the others. I think it is something that slipped through the net as we were going along and just needs tidying up. I look forward to hearing the Minister's views on that. No adequate reasons have been put forward for maintaing the difference.

In that whole area one of the other difficulties that have arisen between the two pieces of legislation is that a number of anomalies will exist. The first one is the different periods of office but there is also the area of running the elections. The returning officer has clear duties outlined in the new legislation, and rightly so. They should also be extended to or included in the 1983 Act. In other words, I think we should go for uniformity, even if only in the sense of the interpretation of the law because I can see some judge down the road in nine or ten years time comparing both pieces of legislation and trying to play one off against the other, or to interpret one by virtue of the experience of the other. I want that problem to be addressed.

I am referring to the date of nomination day, the amount of time people have to return completed ballot papers, that type of detail; it is really tidying up, housekeeping, but it should be done. I agree that the enfranchising of subsidaries is important. Again I would raise the question: will this also apply to An Post and An Bord Telecom because it would appear at the moment it does not? They are some of the areas with which have a difficulty and they are creating a difficulty for the worker directors in those companies. I ask the Minister to consider that and to respond to it at the end of Second Stage and then we will consider whether or not amendments are necessary on Committee Stage.

Section 6 of the Bill deals with the provisions for and the terms of reference and the setting up of sub-board structures. There is one part of that which gives me some difficulty. I am not saying I can propose an amendment to make it any tighter, but it is the use of the phrase "in good time", in other words that information shall be given to workers in good time. I would like to have on record exactly what that means. I am not saying it is bad as it is written. I cannot think of a better form of words. The view and thinking behind it are right. We believe workers should have the information and have it in "good time", but what does that mean? I raise it with the best will in the world.

Going back to one of the points made by previous speakers, information is important but it is also important that information should find its own level among the workforce as they begin to assimilate it and begin to adjust and make judgments on it. Sudden judgments and surprises are not helpful in this area. I have some difficulty with that at the moment. It seems a bit vague and weak, and perhaps we could tighten it up in some way or make it easier to define.

Section 9 to me is the core of this legislation. It provides for the setting up of the sub-board structures. It deals with the participation of workers from subsidiaries of the main company in the election of worker directors. This is essential. Plants and workplaces differ widely within a company geographically. It is very important to have an input at various levels. I take on board the point that it must be a very serious input and a serious level of decision making. It is not just whether the canteen needs a coat of paint or the supply of toilet rolls is adequate etc. Serious discussion is needed. That can happen and will prove effective only when management accept, understand and are educated into an understanding that not all wisdom is invested purely in those who happen to be in management. Therefore, we have a clear duty in this area to provide education structures for people in management, not just for the workers, not just for the worker directors. Let us not for a minute consider that the only directors who need help and support in this field are the people who have just been elected as worker directors. Many who have been there for years could do with a lot of help and this might be the time to give it to them.

The Minister dealt very subtly with the problems of enfranchising the subsidiaries. I read it once and I am not quite clear on what he said. I suspect the Minister put it in a way that is not easy to interpret immediately, so I ask him to explain what precisely he means in terms of communicating with the Minister about any decision to give a franchise to the subsidiaries of a company. He will have to explain to us how that works. I suspect he believes correctly that there should be consultation on the issue. It must mean, I presume, some form of amendment to the legislation. Perhaps the Minister would indicate what that will mean.

Basically the problem is that in many cases the subsidiaries could over-run the main companies in terms of the number of employees. I am not saying that is a bad thing, but it could create problems. It could create a particular problem in a case where some of the subsidiaries are located outside the State. I would like the Minister to address that point and explain to me whether that creates any difficulty in this legislation. Are we talking about giving a vote to somebody perhaps who is working in Hong Kong in a subsidiary of an Irish semi-State company? I am not saying we have moved out to those far flung, distant shores yet, but one never knows. Many of our semi-State companies have subsidiaries.

Aer Lingus have a chain of hotels in the United States and we are now talking about electing a worker director to serve on the board of Aer Lingus who at the moment is working in a hotel in San Francisco. It seems to create some sort of logistical difficulties. I would like to know how it will work logistically and how he envisages it working. Are there any implications in the fact that we are talking about non-nationals as in this case? I do not think it does, but I would like to have it spelled out.

The system of the election of workers is the system of primaries in which people have to get a nomination before they get on the ballot paper. It is one which I am very well aware of because we use it in our own union all the time. Whereas some people consider it to be very cumbersome, I believe it is a very straight and honest way of setting up a ballot paper. The system of election is important. It will have to be cleared and explained to workforces in work places how that is going to work. That will take a fair amount of information and literature.

Does section 9 create difficulties for the 1983 legislation? Does it, in fact, allow the enfranchising of the workers in subsidiaries of An Post and Bord Telecom? I keep going back to these, not to harp on the issue but to point out that we must address this point, particularly when I am looking at what is happening with the similar services in Britain. Whether it is already done or not they certainly have it organised in such a way that the parcel service is separate from the postal service and they are producing counterservices under different headings. That would mean that they could well organise those as almost subsidiary companies. I can see something similar happening here and it is important if these people should, in fact, be included.

Mention has been made already of section 12 which deals with the disqualification of a worker director on resignation. I think the Minister was a bit flippant in dealing with this in his speech. He stated that it is reasonable to expect that worker directors should relinquish board membership when they leave the company. I agree with that. In general, the trade unions would agree with that as well. It is also reasonable to expect that they would give up board membership when they retire or resign from the enterprise. I would certainly go along with that. That is the whole spirit of the legislation. It was always meant to be people working who would represent people who were working.

The difficulty here is that it could happen that a board could conspire to sack a worker and, in sacking a worker who happened to be a worker director, they would in effect be sacking a director. That sounds like a very devious operation but, at that level, devious things can happen very easily. If the board are not happy with, let us say, one of the directors and they feel the only way to sort out the difficulty is to get rid of him or her for some period, they could, in fact, dismiss that person or arrange to have that person dismissed for whatever reason or on some pretext. The difficulty about doing that is that there is no redress; there is no remedy for that worker director because, as the Minister will be aware, the Unfair Dismissals Act can only be initiated when the person has been dismissed.

Therefore, a person who is dismissed from the company is immediately off the board and no matter what then takes place in terms of remedy, that person is off the board for a period of time. It also raises the question of whether during the period when that person is seeking a remedy through the unfair dismissals legislation a new director would have to be elected. A new director could be elected: the original director could win the case under the unfair dismissals legislation; and there would be no remedy because the second person would be duly and properly elected. I have a real difficulty there. I see a way around it. I think that what we could do in that case is to provide that there should be a period when the person might be dismissed from the employment but, if an appeal is going on, he would continue as director for the period of the appeal, or for the period of taking it through the appropriate legislation. I raise that particular point because it is a situation that could be abused. Therefore, if it could be abused — I am not saying that we should always legislate for the exceptional but this is a glaring case and I would be worried about it — we should legislate to prevent that. It is something that has been raised by many people. The ICTU have raised it and the worker directors themselves have raised it in various forms. I think we should address it.

The wording in the Bill is that the vacant position will be deemed to have occurred on the day following the day on which the person ceases to be an employee of the body. Let me say again that it is not that I am opposed to it, it is just that, in the case of a dismissal of a worker, in that narrow area of the dismissal of a worker who happened to be a worker director, it could get us into the difficulties I have talked about. Certainly what I am proposing is that that person should continue to be a director pending the hearing of the case, if a case were to be taken under the Unfair Dismissals Act, and if a case was not taken we should have a time period during which a person would have to lodge the appeal. That is in the legislation anyway but, perhaps, even a shorter period in this case to initiate the legislation could be allowed.

Section 20 of the Bill causes some difficulty. It is the area which deals with the conflict of interests of worker directors. I read this and I re-read it and I have gone through it again. There is something very patronising about this section which seems to say: "You can be a director of a company. We feel you have something to offer but we feel in particular areas there is going to be a conflict of interest". I really appeal to the Minister to respond to me and say what are the actual examples he can cite of conflict of interests. I cannot think of any conflict of interests except the one to which I referred at the beginning where the board might feel they wanted to lay off workers in order to increase their profit and the worker directors would feel they would prefer to continue people in employment with a reduced profit.

I am making the case purely from the point of view of the board. I have said what the workers want and I have said what the other directors might want. Is it not in the national interest that we should keep people in employment? It is not also in the national interest that our industries should be profitable? Therefore, is it either of these that we want? We want a middle line there. We will only get that middle line if all the arguments are brought into the discussion within the board structure. I do not see that as a conflict of interest that would be envisaged here. If the Minister can give me an example of where there would be a clear conflict of interest I will accept that, but I cannot think of anything.

A director might be on the board of a semi-State and be a director of company C which is offering supply services, or selling goods, or marketing on behalf of company A. That to me is a conflict of interests which could cause far more damage to the board than the worker who is seeking to protect some of the narrower interests of the workers in the work place. We should tease that out a little further.

I have asked people about it. I have had talks with people as to whether it has been used because it is in the 1977 legislation. I am talking about the section in the Principal Act which I am suggesting should be changed. I used the rule of thumb on it. Has this been abused at any stage? Can I present examples of where worker directors were told in the past ten years "that is a conflict of interest, you cannot vote on that. Get out while we discuss it"? In fact, I can come up with one example only. I am weakening my own case now and I hope the Minister does not take advantage of me.

The only one I could find was where the chairperson decided that the worker/director should not have a vote because what they were discussing was the proposed increase in pay, or the wage claim of the workers. I certainly would not agree that was a conflict of interest. I see nothing whatsoever wrong with the worker director being there and making the case to the board. It is important for the board to have that information. They can say at the end of the day: "We have listened; we have heard what you have to say. We do not agree with it and we are not going to give the rise." This is something that can be dealt with in another forum rather than the board, but it is the right that should be there.

This section could be used to discriminate against the contribution and vote or franchise of a worker director and it could be used now that we are expanding the area of sub-board activities. It becomes a difficulty now which we must address. I find it impossible to understand what area of work of a company or board would not be of real interest to the worker directors and would, in fact, create a conflict of interest between the workers' interests and the company's interests. It certainly is unacceptable that any of the matters being discussed about the company or the board should constitute a conflict of interests in the way some people have suggested worker directors cannot be trusted. Of course they can be trusted.

I note also that there are certain semi-State sectors such as the Central Bank, etc., which are not included in the legislation. I know all the reasons for this and I will not comment except to say that at the highest level of this State, what is said at the table Ministers sit around once a week, is very often reported in the newspapers. It is unfair to blame the workers for leaks. We have seen time and time again information coming from companies which did not come from the worker directors. As Senator Hillery said earlier, if it is information that is of value to the workers and is necessary for the workers, it is easily enough assessed. If it will damage them if it becomes public, the worker directors will be the last people to leak information of that type. I am saying that for the record. I am not making a case for the simple reason that I have not actually given it enough study. It would be quite helpful in the rarefied atmosphere of the Central Bank to get some of the workforce in there to consider what exactly they are talking about in lay person's terminology. That could be useful.

Section 13 of the Bill refers to section 1 of the Principal Act and the definition of an employee. Every speaker so far has referred to that matter. While Senator Hillery was absent I made it clear that I did not accept what he said about the great need in the future of the dual role workers. I am quite aware of what he is talking about and I have seen the diagrams of the different types of companies and the different elements and satellites, etc. but I do not agree with it. We need to look towards a more flexible workforce, to bear in mind changing technology and to say to a worker at age 20; "The job you are doing today will not be necessary at age 30". Let us start by knowing that so we will also plug into our system a system of re-education and retraining at age 29 so that at age 30, when this company has progressed into new areas, as it will with worker directors, you will be able to take over new areas of work. I object to changing permanent employment to part-time or temporary employment. It creates an unnecessary insecurity of tenure.

There is a difference of principle involved. I am not contradicting what was said by any previous speaker. I am saying that we should be going in a different direction. The work I am talking about here is the word "permanent". The question has come up about giving the vote in the election of worker directors to workers who are working in the company for 18 hours per week or longer. I am certain Senator Fennell is right and the only reason 18 hours was chosen is that that is the figure which has been used in so much of the labour legislation which has, in fact, excluded workers from their rights. At a time when more and more of the workforce is working in a part time and temporary capacity, we should be conscious of and sensitive to their needs and rights.

When discussing labour legislation we should bear in mind and always take cognisance of the fact that there are now huge numbers of workers in part time employment whether we like it or not and I do not like it. Because they are in part time employment is not an argument for excluding them and the Minister has not given the case for excluding them. Perhaps there is a case, but I do not see it. If we were to change the number of hours to 17 I do not see that it would make any great difference. I do not know why 18 hours was picked. I do not intend to suggest a number because the hours of work change from place to place but I will put a condition on it. I am not saying anybody who happens to be in the work-place on the day the vote is taken should have a vote. I am proposing that any permanent employee, whether he is working ten, 40 or 60 hours a week — if he is permanent in the company he has something to offer — should be represented and should have a vote.

Let us leave the hours aside and look at the matter from a different point of view. If the worker is a permanent worker in the company, perhaps part time but in so far as he is attending work week after week, this person should have a vote and should be allowed to participate in the election of the worker directors.

The point that strikes me — and I have discussed this matter with ICTU and the various unions, and it is also a point that has been made very forcibly to me by members of the women's committee of ICTU — is that with the huge number of women workers working part time there is a certain inequity between the sexes. I am not saying it is there deliberately, but it is there by virtue of the way things are. It is something that is against women's participation in industry. That is another reason the matter should be looked at in a different way. We are talking about permanent employees but many part time employees happen to be women and, in this sense, let us take a step towards equality and bring them into the net. We should bring them under the umbrella of labour legislation in this area and under the umbrella of worker participation and democratic structures which produce worker directors. This group of workers who are now left without the protection of labour legislation, which is bad enough, should not also be left without representation by the worker directors. I am not saying the worker directors would not represent their interests, having been elected, but they should also have a vote in that election.

There are no financial implications that I can think of. It will just mean a couple of extra ballot papers. If the people are on the books and in permanent employment it does not create a difficulty. If it does create a difficulty we should hear about it. I am making the case to forget about the number of hours and to talk about permanent employees.

There is a problem, in section 21 of the principal Act, with the appointment of elected worker directors by the Minister after the election. The election takes place and then the Minister makes the appointment. There is a lacuna there which is unnecessary and which should be filled by legislation. There should not be any gap. It has led to confusion and difficulties. As far as I know — and again I stand to be corrected on this because I did not check it out in the last number of days — there is one instance of that at the moment in B & I who are at a very critical time in terms of board meetings and meetings at which workers would like to be represented. If the worker directors have not been appointed in the last period, that is scandalous. They should be there. It is a matter of tidying up the legislation so that when a seat is vacated for whatever reason — there are a number of ways in which it could happen under the legislation — we should seek to have that seat filled as soon as possible. I use the words "as soon as possible" wisely because I am not saying you can fill them the following day. Seats can be vacated suddenly for many reasons like death or somebody changing employment very quickly. I am not saying seats can be filled in all cases without leaving a gap. In the case of a retirement, the person can be replaced without having a gap in the representation whereas in the case of somebody leaving suddenly without notice it means that we need to set the machinery in operation straight away.

I would like the Minister's views on one point. When filling a vacancy from the electoral list, I presume the highest person on the list who did not get elected will be the person who will fill the vacancy in that instance. That of course creates a difficulty for many of the groups who would put forward one person. In trying to operate the PR system they would lose representation. I have mixed views on that. I have thought about it and about the interests involved and the interests of democracy and I am not sure if there is a resolution to it, but I would like to hear the Minister's views. I notice he did not deal with it in his opening statement and perhaps he might come back to it at another time.

I have dealt with two areas: the filling of a casual vacancy and appointed people after the election. I would like those two areas to be addressed by the Minister to see whether they should be tied into legislation and whether a certain number of days or weeks should elapse following an election, which I presume would allow for appeals against the election, before the person would be appointed. There are other more detailed areas which I wish to address but the Second Stage of the Bill is not the appropriate place to do that. I will listen to the Minister's response to the general issues and then consider what amendments to put forward for Committee Stage.

I will finish as I began by putting it on record that the Minister for Labour has certainly shown himself to be committed in this area. I have many difficulties with the way Governments operate and in particular with the policies of this Government which I have been loud in articulating and voicing whenever I got the opportunity. In this legislation the Minister for Labour has shown his own personal commitment to improvements in the areas of industrial relations, to an improvement in the participation of workers in industry and, indeed, to taking a step which is positive and progressive and which will take us very far forward in a way that has been proven to be effective in many other countries.

I am glad the Minister, in all his dealings with problems in industry, has recognised the role of trade unions. He knows that in countries where the trade union movement have worked closely with the Government — I am talking here of the Government and the trade union movement having had serious negotiations over the past number of months — negotiations have been fruitful. He will see that it is important to have the trade unions always involved, always referred to and always included in the discussions and in any negotiations in this area. People in the trade union movement who have expertise in this area are always willing, as the Minister will confirm, to give of their time, of their expertise and of their energy. I thank the Minister for introducing this legislation. I will certainly be supporting it strongly and I will be putting forward minor changes as we go along.

An Leas-Chathaoirleach

I call Senator John Robb.

I think Senator Ferris may have some difficulty.

I have. I will try to finish as quickly as possible because the next motion is to be taken at 6.30 p.m.

Is that in order, a Leas-Chathaoirleach?

An Leas-Chathaoirleach

I call Senator Ferris.

I thank Senator Robb for allowing me to contribute at this stage. Obviously Senator O'Toole and I have been briefed by the same source and that will be of some help in that my remarks will not be as extensive as his. The Irish Congress of Trade Unions have obviously made a submission to Senator O'Toole as well as to me and he has covered some of the ground which I wanted to cover. I would welcome the Minister's response to the specifics in various sections of the Bill. It would be remiss of me if I did not welcome the fact that the Minister has brought in the legislation. Even though it differs from that of his predecessor and my colleague, Deputy Ruairí Quinn, it covers much of the areas we had hoped it would cover. It follows from the report which was made to the Minister by the excellent Advisory Committee on Worker Participation. Perhaps the Minister, in the generous response which I know he will give, will tell us, as a progressive Minister which we all know he is, his real views on the actual conclusions and recommendations the review group and advisory committee submitted to his predecessor, particularly in the area of the extension to the private sector of worker participation and their rights. They also recommended the establishment of a council on employee participation with functions as outlined in their report. The Minister's response is eagerly awaited by everybody in the trade union movement as to whether he agrees with the principle of involving workers in the whole workforce area, whether in the private or the public sector. It is not an ideological but a very fundamental comment that will be eagerly awaited from the Minister.

This Bill deals with a number of companies in the State sector and, as has been mentioned, they are outlined on page 17. Even though Senator O'Toole was aware of the reasons for excluding some financial institutions, perhaps the Minister would be forthcoming and tell us why he excluded financial institutions such as the Central Bank and Irish Life, areas where financial decisions are being made and where we contend, for a labour and a trade union point of view, worker participation would be of benefit to the nation and certainly to the company. We were disappointed that those institutions were excluded. The Minister also excluded RTE, VHI, Bord Gáis and Irish Steel, the kind of companies that are dynamic and successful and would benefit from this whole concept. I know the legislation gives the Minister power to add to the list of companies and I hope he will use that power. I will have some comments to make on his powers to remove some companies because that would be against the principle of this Bill.

I want to make various comments dealing with some of the concerns of the Congress of Trade Union people I spoke to and worker directors. On the question of the liberal interpretation of a good length of time, the workers would like to have adequate time in which they can consider proposals which emanate from management in advance of the board meeting. These would involve areas of finance, staff changes, development of the company, planning, rationalisation and all areas in which workers may need to consult with their peers who have elected them. The management might think two days sufficient but a worker director might need a month and therefore, the Minister will have to be more specific. I do not think the word "adequate" is sufficient. It is too weak and the Minister should see if there is some way he can strengthen the wording in that section. The wording in section 6 is also a bit weak and perhaps we could have the Minister's views on how we could strengthen it.

I am concerned about section 9 and the power to extend worker participation. That seems like an excellent thing to do but the Irish Congress of Trade Unions have made other suggestions in this regard. Section 9 refers to Aer Lingus and the Minister has indicated that this is an area where a problem arises. Whatever about Tokyo, we know that Aer Lingus, an Irish national flag-carrying company, have a tremendous involvement in the United States. The trade union movement are worried that workers outside the jurisdiction, particularly in the United States, could have a vote in management decisions in their company. We are concerned about this, as are Congress and the Minister. Perhaps the Minister might define whether he will confine voting rights for workers in companies with outside subsidiaries to within the EC in that concept. If he did that he would probably conform to EC law and he would have our support in doing so. It is an area of concern for all of us. I welcome the fact that the Minister mentioned it in his Second Stage speech and that he has agreed to look at it before we get down to the nitty-gritty of Committee Stage and Report Stage where we will discuss section 9 and how it will affect the workers in Aer Lingus. There is a central representative council in Aer Lingus, a fairly powerful body, and we would like to have their consent and agreement to this legislation.

We are also concerned about the definition of "employees" for voting purposes under section 13. A number of hours has been mentioned which seems to be unacceptable. I accept Senator O'Toole's point that, if the person is permanent in a company, irrespective of the number of hours he works, he should have voting rights to elect people to represent him as worker directors on a board. Decisions would then be made which would involve all the employees of the company. The vested interest of a worker director was mentioned.

I know from experience in my own county, in Bord na Móna and in Comhlucht Siúicre Éireann Teoranta, that the company, in making decisions which involved the future of employees, whether on pay agreements, productivity agreements or otherwise, asked employees not to participate. They were not privy to information that was released to other directors in advance of some of these decisions, based on the fact that the chairman of the day of the company interpreted this special interest clause as referring to worker directors. I know the Minister has the spirit of this Act at heart and that he will not be afraid to define the "vested interest" clause. Certainly all of us have vested interests, as members of local authorities, in planning and if outside financial interests are concerned then they have a vested interest also. Surely if we believe in the concept of the election of worker directors to sit on boards then all worker directors should have a say in the decisions of the board. I hope the Minister will confirm that when dealing with this section.

I am also interested in another area which has not been mentioned by previous speakers and that is the situation that has arisen vis-á-vis the board of NET. About two years ago discussions took place between the then board of NET and ICI and a joint venture project was set up of which NET has a 51 per cent interest and ICI 49 per cent. The worker directors on the board of NET are precluded from decision making. There are no worker directors involved. The normal work which is applicable to worker directors has been interfered with by the new IFI board. Facilities such as cabinets and telephones, have been removed from the worker directors. The number of days that they can spend at board meetings which are relevant to the IFI enterprise but are only discussed at NET board meetings has been curtailed. The new directors of IFI have precluded board members from participating fully as they have done in the past and have reduced the number of days that they can take off to attend board meetings. That is contrary to the whole spirit of what was confirmed in a letter from the Department of Industry and Commerce in January to the new board members of NET. I will put on the record that the Minister for Industry and Commerce informed the worker directors that he had signed the warrant appointing them as directors with effect from 21 December 1987 and sent them a copy of the warrant.

The conditions which apply to directors of the company are contained in the relevant provisions of the articles of association of the company. In particular the following terms apply. "As much time shall be devoted by each director to the performance of his duties as may be necessary for the proper and efficient discharge of those duties". That would have been acceptable in the past with the board of NET but now the new board of IFI have put question marks on the number of days allowed for meetings and on whether the worker directors would have the day before the meeting to make preparations. Certainly they have excluded the day after the meeting which was used as a day for reporting — it is called a communications procedure — a procedure of reporting back to the shop stewards decisions that were made at the board meeting which were relevant to the terms of employment or otherwise. The new board of IFI do not allow that day off anymore. One of these worker directors who happens to be the chairman of the whole national worker directors group has been excluded from carrying out his duties as a chairman of the whole group and also, as a worker director in NET, from participating in this follow through. That is against the whole spirit of the Worker Participation Act, 1977.

Perhaps the Minister might use his influence with the new board of IFI which, I think, specified that, as a new joint venture project, they did not want worker participation. I thought that NET, with 51 per cent and the majority of the new company, would ensure that their worker directors should be adequately represented at all meetings relevant to the functions of IFI but apparently that is not the case. I am putting this matter to the Minister in the House in the hope that it will bring to the attention of the Board the fact that worker directors are being denied some of the facilities they had in the past. This could mitigate against the co-operation of the trade unions and other people in the future in what might be considered joint venture projects under the National Development Corporation or any other State agency that we would put in place to try to stimulate the public and the private sector to work together. If this concept of worker participation is denied in that new development then that would be a backward step in industrial development.

A letter was sent to all the staff in Irish fertilisers industries, signed by Mr. Jago, the managing director, in which he confirmed that they would have all the normal facilities that are available. He said that is essential for the future viability of the business. He also said the new company will have a broad range of products, strong market position, et cetera. He confirmed in that letter that the staff would have the same employment opportunities as existed elsewhere and that they would automatically have the same rights and so on as a new company. The worker directors, although they had the same terms of employment, because of their involvement in the old NET enterprise were precluded from carrying on their duties. They have asked the company for a specific response in various areas but that has not been forthcoming. The Minister should address that problem.

I will deal briefly with the question of the Minister's right under this legislation to add to or take from the list of companies. The Second Schedule, Part II, subsection (2) (a) states:

Subject to subsection (3) of this section, the Minister may by order amend— (a)

the First Schedule (as amended by subsection (1) of this section) to the Principal Act by—

(i) adding or deleting one or more bodies to or from, as the case may be, the list of bodies contained in Part I or Part II thereof,

I believe it will be the Minister's philosophy to add companies to this list that has been circulated but I would have the gravest reservations about giving some successor of his in the future the power to delete any number of companies that he saw fit without recourse back to us. I would prefer if this section gave the Minister the power to add more companies and certainly we would all be in favour of that. The Minister should not have the power by legislation to remove names of companies because then the whole concept of what we are doing is questioned. Some Minister in the future — not the present Minister because he is progressive — might use this power against the spirit of the Act. We will be looking for the Minister's advice on this matter and maybe assist him by putting down a suitable amendment to remove various words, but I would prefer if that kind of initiative were taken by the Minister.

There is the question of the time factor between the outgoing directors and the incoming directors who have been formally elected but have not been formally appointed by the Minister. We feel that there should be no time lapse, that the outgoing members should continue in position as worker directors until such time as the new directors take up occupation. Otherwise there could be a period in which no worker director would be represented at board level. The Minister of the day might not have had time to make the order appointing the new member elected. We want a continuation of service of worker directors in all of these companies. If there is an election held to replace them we contend that the existing worker directors should continue in office until such time as the new worker director is appointed by the Minister.

I want to thank the Minister for having introduced the Bill. I hope he will be forthcoming in his amendment in order to tighten up some of the sections worrying people directly involved in the legislation and whose co-operation will be needed to render the provisions as effective as possible in the future.

Debate adjourned.
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