I move:
That Seanad Éireann approves the following Order in draft:
Worker Participation (State Enterprises) Order, 1989
a copy of which Order in draft was laid before Seanad Éireann on the 14th March, 1989.
Worker Participation (State Enterprises) Order, 1989: Motion.
Section 23 of the Worker Participation (State Enterprises) Act, 1977, as amended by section 21 of the Worker Participation (State Enterprises) Act, 1988, empowers the Minister for Labour, after consultation with the Minister for Finance and other appropriate Ministers, to prescribe by order the number of directors or board members of State bodies covered by the acts including the number of employees to be appointed after election by the workforce. The acts require, broadly speaking, that elected representatives should make up one-third of the membership of each board.
The present order sets the board size and the number of worker directors of Aer Rianta. The effect of the order is that from the date on which it is made the size of the board of Aer Rianta will be set at nine, with three directors to be elected by the workforce. The board size has been set after consultation with the Minister for Tourism and Transport who, in turn, consulted representatives of the unions in Aer Rianta. The Minister for Finance has also given his approval to the proposed arrangements.
I will also be making a related statutory order the effect of which will require Aer Rianta to hold worker director elections under the worker participation legislation in 1989. These elections will be held later this year. This will bring to 11 the number of State-sponsored bodies which have worker directors appointed under the Worker Participation Acts, and completes the list of bodies specified for board level participation.
In addition to the provision of board level arrangements, the 1988 Worker Participation Act provides for the introduction of sub-board participative arrangements in a range of State enterprises. I regard this as a very significant development and I am glad to say that Aer Rianta and a number of other bodies have already made significant progress in this area.
I recommend that the House approve the draft order.
On this side of the House we have no difficulty in supporting this measure. In fact we welcome the extension to Aer Rianta of the principle of worker directors. The operation of worker directors in our State companies has now ceased to be an experiment. It has been in place since the mid-seventies and, as the Minister said, this is the 11th such State company to make this move. At this stage it would be of interest if perhaps the Minister's own Department or, indeed, Senator Hillery in his other capacity as Professor of Industrial Relations might embark upon a study on the effectiveness and the impact of this experiment to date, to see to where it has worked, what the difficulties and dangers have been and perhaps to chart areas in which the experiment could be extended into the private sector. Having said that, I welcome this development and wish it every success.
I, too, warmly welcome the order before us which fixes the number of directors for Aer Rianta at nine, of which three will be worker directors after the elections. Picking up a point the Minister made about the initiative and the ground work already laid by Aer Rianta in this connection, I think it is indeed a company which has been preparing for worker participation for many years past. It has been the company philosophy to secure greater co-operation between employees and management. The staff are encouraged to participate in the workplace and the open style of management, which includes disclosure of information, has characterised the conduct of business affairs there for many years. This is in sharp contrast with the practice so common in the past in this country and elsewhere, where orders were issued by management without question and indeed employees proceeded in the workplace without even understanding what were the policies.
Unions and management in the company have shown exceptional initiative in identifying what participation is all about and how to go about building the foundations for change in the company. This has been greatly facilitated by the establishment of a joint working party on participation, composed of representatives of both management and trade unions and facilitated by an officer of the Irish Productivity Centre. This group is developing and promoting forms of worker participation suited to Aer Rianta.
Speaking of suitability to Aer Rianta, I think this is in accord with the Act we passed here last year, the Worker Participation (State Enterprises) Act, 1988 providing for sub-board structures. The Minister in that Bill said the intention was to leave it to individual companies to tailor participative arrangements suited to their own philosophy and their own practices. Aer Lingus matches this legislative intention exactly in what they have been doing.
The ability to introduce change in the late eighties is, of course, a requirement for many companies and the open approach of management, combined with the co-operation of unionised employees in Aer Rianta, have helped to advance changes in areas like reorganising Departments, with introducing new work practices and procedures and improving training.
Finally, I had the pleasure in my capacity as Professor of Industrial Relations at UCD of addressing the Aer Rianta staff at Shannon some 18 months ago at a seminar on worker participation. The seminar was part of the ongoing study and development of participative structures within the company. I feel that the company philosophy and the commitment and response of the workers have contributed greatly to its success and indeed to its most recent important business initiative in the Soviet Union.
Aer Rianta featured prominently in the recent visit of President Gorbachev and their management of the duty-free airport at Moscow is an example of the type of expertise we have which can be very usefully applied abroad. Furthermore, it seems that the expertise and experience which they have got which is now being utilised in Moscow can and probably will be extended to other parts of the Soviet bloc. Aer Rianta have led the way for further business and trading links between Ireland and the Soviet Union and full credit is due to the management and staff of that organisation. They are committed, involved, business-orientated people and the election of worker directors should supplement, and will supplement, the very important initiatives in the participative area on which they have been engaged for some years past.
Before I call Senator Harte, this is one of the times when, as Cathaoirleach, I am at a disadvantage. I would like to put on record, whether I break rules or not, the extraordinary commitment of workers and management of Aer Rianta.
I would like to welcome the order. In the final analysis we have been arguing about what type of participation might suit each particular plant or what might suit a State enterprise which might not suit a private enterprise etc. Professor Hillery made the point that enterprises should tailor participation to their own needs. I think this is what has been happening. They have been looking at it and trying to tailor the system to their own particular needs. Because of the dialogue the great thing we find is that the unnecessary conflict that existed is being gradually eliminated by this whole concept. The Minister is playing no small part in it but the fact of the matter is that once you are heading in that direction this unnecessary conflict begins to diminish. Workers came to realise that they are not only getting wages out of the company: they are getting the things they have been denied for a long time, information and some sort of control and input in an area of their own lives that had been affected by decisions in which they had no say and about which they had no information or understanding. The fact is that we are behind our European partners in this area but we are fast catching up.
I would like to finish on this note but not in an antagonistic way. The private side of enterprise should decide to try to make progress. There is a little hesitancy there on the private side. There is still a lot of a "them and us" attitude in the private side of enterprise which can be eliminated by eradicating such problems. For example, somebody feels that his business is being bought out by some smart person who has a few million pounds and suddenly he decides on redundancies. That person has nothing to aim for beyond the worry of whether he is going to be out on the street and he has no information to disseminate down to his fellow workers, if he is a representative. There is a lot of ground to be made up on the private side. At the rate change is occurring if something is not done very quickly it may be too late, not too late in the sense that we will not have industries but too late in that the development of democracy itself as a concept will have been denied in the private enterprise area.
I would like to thank the Senators for their promptness in dealing with the order. In answer to Senator Harte's question, I agree that one cannot ever extend worker participation too much. It is something that is ongoing. It is important in passing this order that we put on the record for those who sometimes argue for worker directors and seek to bypass the process of the 1988 Act of the sub-board structures that in the case of NRB and again in Aer Rianta we are showing by the unanimous views of all parties in the Seanad that if State organisations are prepared to operate the system at sub-board level then the Government are prepared to consider and bring to the Houses of the Oireachtas the concept of worker-directors at full board level. I do not think there is wisdom in bringing worker-directors straight from an area where there is no concept of worker participation on the board.
I did not mean to imply that. I am not so sure that it would be a good idea.
I know the Senator is talking about the private sector. I do not disagree at all but the point I am making is not in contradiction of the Senator. We have now, following the passing of the Worker Participation Act, some 38 or 40 enterprises where there is worker participation at sub-board level. A great many of those have started the process of making it work but there are others who have not started that process. Many of them would say, "Why bother at sub-board level? Let us come in with the big boys and be worker directors and run the show."
There is a great need for people to do as Aer Rianta did and that is to work the system for a great number of years through their democracy council. It is equally fair to put on record a tribute to the great role played by Aer Rianta and the good work they have done. The democracy council would be a strong union group and they have been part of the great success and achievements of Aer Rianta in recent years. There are other examples of it also and there are clear signs in favour of worker participation of worker directors. Participation between both sides can convince the Government that they should have worker directors, can convince both Houses of the Oireachtas, and the Departments of Finance, Labour and Transport that there is clear support from everybody in the system for the principle of worker participation. However, people have to work at it. By definition it is participation and one cannot go from A to Z without going through all the steps. Aer Rianta have done that and are to be commended for their work. It is for that reason that people have passed this order which allows the elections to take place in the months ahead.
Question put and agreed to.
Sitting suspended at 5.20 p.m. and resumed at 6 p.m.