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Seanad Éireann debate -
Wednesday, 10 Mar 1993

Vol. 135 No. 6

Unfair Dismissals (Amendment) Bill, 1993: Second Stage (Resumed).

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

I was making the point that while compensation is a very common form of award in cases of unfair dismissal, the actual sums awarded tend to be low and, therefore, I welcome the Bill's provision to exclude from the calculation deductions for income tax and social welfare or, as the Minister put it, to disregard these sums. I do not think that is going to be very expensive for employers. At present — and these figures I have extracted are reasonable examples — the average compensation awarded in 1989 was £3,232, in 1990 it was £3,600 and in 1991 £2,660, so we are not talking about big money. Therefore, I welcome the new method of computing the basic award which disregards tax and social welfare.

With regard to reinstatement and re-engagement the best I can derive from the figures for the three years for 1989 to 1991 is that 30 per cent of the awards were of the reinstatement/re-engagement category. There is also an interesting provision in the case of an employee who has been dismissed but receives no financial award — let us say they get a job immediately.

Sadly, not at all often. Nonetheless it is important to address this possibility in the Bill because such unfairly dismissed employees receive no financial compensation even though their position may be vindicated. I welcome the provision for payment of up to four weeks pay in a case of this kind, where there is no actual financial loss.

With regard to the emphasis on fair procedures I listened with interest to Senator Neville. The theme of fairness runs right through Bunreacht na hÉireann. Since fair procedures are a fundamental requirement, reinforcing that in the Bill is a good thing provided that the tribunal exercises objective judgment. There is the risk, I concede, of becoming overly legalistic. The law is not always suited to the realities of interpersonal relationships and should be used as sparingly as possible while at the same time recognising the importance of rights in law in unfair dismissals cases.

Enforcement is, in practice, another bone of contention and the strengthening of the powers of the tribunal and of the Circuit Court in this regard is welcome, as is the simplification envisaged by the Act.

I have spoken about the reinforcement of procedural matters already, but we may well debate that further on Committee Stage. With regard to time limits for the submission of cases, the six month limit was unreasonably short. It can take quite some time to sort out all the details for the commencement of proceedings and extending this time limit to one year brings it into line with redundancy and equality arrangements. There may be good reason for delays and an additional six months is a step in the right direction.

I look forward to discussing the Bill in greater detail on Committee Stage — it is the type of Bill that lends itself to that. The existing Act has worked well, in general. The Minister referred to organisational flexibility and while flexibility is important, as legislators we need to hold centre stage to see both sides of the question and the Bill achieves that admirably. Many lessons have been learned during the 16 years since the 1977 Act but its amendment is now necessary and I welcome the Bill.

I appreciate the Minister's initiation of this legislation in the Seanad which is particularly suited to amending legislation. The Bill will get a fair hearing on all Stages which it would not receive in the other House, which operates differently from this one. A Bill amending existing legislation is always difficult to deal with and it is important that Senators are allowed to speak on Second Stage. It is not my intention to use my full 30 minutes but I will allow other Senators to get involved. I will confine detailed comment to Committee Stage on which I will move a number of amendments.

The Minister can take a bow for her progressive move in including the sexual orientation of an employee as unfair ground for dismissal. It is critical that that provision be enshrined in legislation. I welcome the move as a small step on the road to social tolerance. The Minister can take the kudos for it; we on the independent benches appreciate it. We have been calling for its inclusion in legislation for a long time. As general secretary of a teacher's union whose members are worried about this possibility, I am glad this provision will soon be law.

Traditionally I comment on the drafting of legislation and I always do some gender-cleansing. I compliment the people who drafted this legislation. It is written in non-sexist language which is very welcome. Time and again I have had to change legislation. However, on this occasion I have to say that even Homer nods because there is one section on which I know the draftspersons and the Minister will be pleased to accept an amendment. On age 9, line 35, section 7 (4) (b) (II) reads "that he objects to the claim being heard by a Rights Commissioner". I wish I had not found it, but it is there and I will be proposing that we replace it with "the Party objects ..." It is the exception that proves the rule. The draftspersons have done an extraordinarily good job in regard to non-sexist language in this legislation. It is very important that sexist language be taken out of legislation. This Bill is the best example that I have seen in my time in this House.

I also welcome the fact that the issue of travellers has been included in this legislation. In the debate on the incitement to hatred legislation to which the Minister referred and which was also introduced in this House, or at least there was a long debate on Committee Stage on it, Members on these benches put forward a proposal. Either Senator Norris or myself put forward a proposal that it would include travellers and sexual orientation. At that time the Minister of the day refused to accept it. It went to the other House, was accepted there and came back here. We certainly followed this point through on many occasions.

I would like to put on record, as a trade union official, that this meets many of the demands we have been seeking over the past 15 or 16 years. It is progressive, positive and effective legislation. I will be proposing amendments but I do not want that to take from the honest, first reaction to the legislation that it is progressive and balanced and will be welcomed in many places.

I remind the Minister that there is a problem that employers are not aware of legislation. We know that ignorance is no excuse in the eyes of the law. It is important that employers become aware of what they can and cannot do and what constitutes unfair dismissal. There is a need for employer organisations to bring to the attention of their members what is possible under the law and what is not possible. It is in everybody's best interest, trade unions and employers, that knowledge be freely available. It is important that people know what the law is and realise they are subject to the law. There is an extraordinary belief that the law does not apply to small employers in the same way as to large employers.

I am particularly pleased with the section which addresses the question of continuing contracts of employment. I have a vested interest in that subject because a large group of members of my union are subject to one year contracts in the education service as temporary teachers. I will be looking with great interest to see how I might extend the proposal in this legislation to that area to ensure at least a right to permanency, in certain situations, for such people. It does not directly affect the Minister but she knows the convoluted way I approach even the most simple issue.

I would be on your side of the fence as distinct from the other side.

This legislation will give confidence to workers. There will be a levelling of the playing pitch, maintaining a balance. I will keep stating that as I know there will be objections from other places over the next number of months. I ask the Minister to hold her nerve on this legislation in regard to the matters I mentioned.

I regret the exclusion in the Bill of the Garda and the Army. It has a damaging effect on the morale of any group of workers. I represent a group of workers, and this also applies to the Garda and Army, who are excluded from access to the Labour Court under the terms of the Industrial Relations Act, 1946. I believe it was an accident of the time because when the legislation was going through the House in 1946 my union was involved in major demonstrations on the streets of Dublin. There was a row about conciliation and arbitration and it was just simply a factor brought into the debate because of what was happening on the streets during that week. I have regretted that ever since and, even though I was not around at the time, it is something which has worried me.

I believe others should also worry about the status of employment of the Garda and the Army. They are entitled to the same conditions of service, support services and access points as other groups. That has been the tradition. They were late into conciliation and arbitration process but they are a group of workers who must have access. Members will recall that in recent years a high-ranking member of the Garda took a case against the Government relating to unfair dismissal. It applies to people in different walks of life.

I noted that in presenting the Bill the Minister did not make any attempt to explain why they were excluded. I look forward to hearing the Minister's comments on the matter. We can deal with the exclusions. For example, if somebody is dismissed on the basis of a court-martial finding that could be considered an exclusion. It is easy to deal with specific aspects like that. There are decent, hardworking people in the Garda and the Army. They are workers like all the rest of us, they are paid a wage or salary and they deserve the support of the law, particularly when it is so much part of their job to uphold the law. They are also entitled to redress under the law if they think they have a sense of grievance.

In the definition section there is a new definition of trade union. I am always worried about new definitions particularly when they might refer to myself. It has now been restricted to Part II of the Trade Union Act, 1941 whereas in the previous legislation it referred to the Trade Union Act, 1941 and the Trade Union Act, 1971. There might be a good reason for changing it and I would like to hear it. It has been allowed to remain unchanged in other sections of the principal Act and I want to know why it has been changed in one place and not the other. Section 14 (3) of the principal Act refers to "a trade union or accepted body under the Trade Union Acts, 1941 and 1971". There may be a good reason for this and perhaps the Minister will deal with the matter in her reply.

When I read legislation I always worry about the tricks of those drafting legislation, the kind of saving clause thrown in, for example, "as and when resources are made available". In this Bill in section 2 (3) we read: "In this Act the reference to any enactment shall unless the context otherwise requires...". That is a very handy phrase to use but I want to know the reason for it or else I will seek to have it removed.

I am utterly confused about section 3 (a). I spent a long time trying to get used to Bills when I came into this House, to working out the difference between Parts, sections, subsections, paragraphs and sub-paragraphs and I have a good grasp of it at this stage. Can somebody tell me what Roman numerals I and II and A and B in section 3 (a) are called? They are not Parts, sections, subsections, paragraphs or sub-paragraphs. I would like to know how to refer to them when discussing that section of the Bill.

Section 4 of the Bill, deals with the situation where there is a lock-out. It is important that this issue be dealt with, and it is dealt with very well in the section. I hope it improves the situation. I am not clear about the "and" and the "or"——

Senator, I am very reluctant, as always, to interrupt you in full flow.

I know you are going to tell me that we are on Second Stage of the Bill.

Acting Chairman

I am glad you have anticipated my intervention, but you are straying from Second Stage.

I accept the validity of your ruling. Unfortunately, I know too much to disagree with you on the matter. I have made the point and I will be referring to it as I go along.

Regarding section 5, the idea of covering three of four different options at the same time has been dealt with very effectively in the Bill. I hope it works and that people understand the way it has been set out to work. It is very complicated and it is very important. Regarding section 6 it is impossible to describe what it is like to go through an unfair dismissals process with a worker who feels an extraordinary sense of grievance. It is important to recognise that it concerns more than money. It is about dignity and putting the record right.

I welcome the section which allows compensation even where there is no monetary loss to be compensated. I presume that is the thinking behind that section as it will apply where a person gains immediate further employment or where there is no monetary loss because a person is drawing social welfare. It is very important.

I also welcome the statement in that same section where the conduct of the employee can be taken into consideration. If we are seeking fairness on all sides it is good that these things should be examined in order to achieve balance. As a trade union official I have no difficulty with that. Either a case is right or it is wrong and it is not a case of pulling the wool over anybody's eyes. It is important that everything is on the table for discussion. It is also important for the reason I have outlined, that the statement should contain the basis for redress. That will be welcomed by all sides and by anybody who has ever worked on an unfair dismissals case. The fact that there will be a reason given is very welcome. However a person feels about the final outcome, they will now have a clear indication of the reasons for the decision, and that is very important. I also like something that runs through the legislation and that is that the onus to do the paper work has been taken from the employee and passed to the Tribunal or the employer. It is amazing how many cases have been technically out of order because the paperwork was not sent somewhere at the right time or time ran out. I welcome the move to have this matter addressed.

In terms of the amendments to section 8 of the principal Act, I have some difficulty with subsection (4). In deference to the Cathaoirleach I will not go into detail on it but there should be power to seek implementation on foot of a statement from the tribunal. A person goes through a process and there is subsequently a determination. The determination is then sent to the employer to be implemented, whether it is reinstatement or a cheque, and the employer ignores it. Very often this is the first reaction because this is somebody who has been involved in an unfair dismissal anyway. It seems daft that the whole rigmarole has to be set up again and a full resitting had to seek the implementation of the determination. That surely should not be necessary. It should be possible for that to be done on foot of a letter from the Tribunal, that the Tribunal would simply state that the determination needs to be implemented. I look forward to teasing that out and to hearing the Minister's response.

I do not understand the words "as respects" in the last paragraph on page 9. Perhaps it is legal terminology I am not aware of. However, when I do not understand something I have the habit of pushing it to the limit. It seems to have the meaning of "in respect of" but I look forward to finding out its meaning.

The reference to the Income Tax Acts and the Social Welfare Acts will be welcomed by people on all sides. I always felt that it was an irrelevance. The requirement in the principal Act to seek employment, to make every attempt to seek employment and to gain compensation in one way or another is good and positive. What is being done in this legislation to negate the effects of social welfare is very important. I welcome the subsection which requires the Rights Commissioner or the tribunal to indicate to the Revenue Commissioners any practices they come across in the course of their investigations which are in contravention of the Revenue Commissioners' regulations, because this is the way the public service should operate. They should make the private sector do the tax collecting, and make it aware of the needs of the Revenue Commissioners. This way the State saves money. This will put a lot of pressure on people to get their houses in order.

There are a number of aspects of the principal Act to which I will return on Committee Stage. In deference to the Cathaoirleach, it would be inappropriate for me to go into them at this stage. I notice, for instance, in the new legislation that, in the case of a winding up or a liquidation of a company outstanding amounts due to a person as compensation for an unfair dismissal or in other cases which might arise from this legislation are made priority payments. I recall that under section 9 of the Companies Act the amounts due to the Revenue Commissioners have priority, they have first claim. That legislation also outlines a priority list of the people who have first call on money. If it were a public company where there were certain types of debenture capital, or shareholders or others were owed money, is there a conflict there? In my reading of the Bill it seems there is and I would be happy to find there was no conflict. It seems there is something there which needs to be examined and clarified. The words used in the principal Act is that it would be in priority to all other debts and I am not sure that that is enforceable under the current legislation.

I have gone through aspects of the legislation bit by bit and I accept the Cathaoirleach's ruling that, perhaps, I was examining it in too much detail; that will be for Committee Stage. This is legislation which improves the conditions of workers and it allows fair and honest employers to have a level playing pitch against the cowboy operators. It goes some way towards ensuring that there is a level playing pitch when it comes to the tax arrangements of companies and for the first time it brings sexual orientation under the umbrella of what constitutes an unfair dismissal under the 1977 Act. It also includes the position of travellers but does not include other issues. The Minister's statement referred to parental status. Could she tell us why she did not consider including that in the Bill because the issue has arisen occasionally?

Nevertheless, the Bill makes life easier in the area of casual labour. It will give hope to people in that area, whether it is the post office, teaching, RTE or the private sector. It will give hope to people who have been put off permanent employment by the repeated use of contract employment to keep everybody on their toes, in other words, threatening them with the loss of their jobs.

This is a job well done and I compliment the Department, the Minister and those responsible for introducing it. I say these nice words so that we can have decent arguments on Committee Stage when I suggest changes.

I wish to share my time with Senator Gallagher.

Acting Chairman

Is that agreed? Agreed.

I welcome the Minister. The Bill is in line with the promise in the Programme for a Partnership Government and commitments given under the Programme for Economic and Social Progress. It does not propose any major changes.

The Unfair Dismissals Act, 1977, brought about significant changes to protect workers covered under the Act. Prior to that, non-union people had no protection. This Bill also gives protection to minority and disadvantaged groups. The Government is committed to the review of labour legislation to give protection to a number of disadvantaged groups against discrimination on grounds of religion, handicap, race or sexual orientation.

As a trade union official I concur with many of Senator O'Toole's remarks. When a worker is dismissed it has a terrible effect on his life, his livelihood and his family. It is one of the most frustrating things that could happen to anybody. Loss of wages badly affects his living standard. It often results in temporary or long term unemployment. The link with the work-place is broken and valuable skills and work experience are lost. For that reason it is a depressing future for anybody to face.

In 1982 it was estimated that one-fifth of the workforce did not come within the scope of the Act. Since 1992, with the growth of part-time, temporary and casual employment, the figure is much higher so more protection for all workers is necessary and the Bill goes some way to achieving that. What is the reality, on a day to day basis, of the unfair dismissals legislation for industrial relations practitioners? The realities are avoiding unfair dismissals with compensation and re-employment.

Some questions must be asked. Are there certain circumstances in which claims arise? Are unfair dismissals claims a serious industrial relations problem when considered in the light of the number of notified redundancies and the current disturbing operating climate for business? Are persons claiming unfair dismissals successful in terms of getting their jobs back or in levels of compensation obtained? The figures do not seem to bear out that they are successful in getting their jobs back. Most cases end up with compensation. What should the reaction of the industrial relations practitioner be, whether he or she is a trade union official or on the management side of the table?

A review of the annual reports of the Employment Appeals Tribunal for the years 1988 to 1991 as well as a perusal of the records of the tribunal for 1992 provide an insight into the current daily reality of the system. The record of the Employment Appeals Tribunal reveals that claims for unfair dismissals arise in about as many ways as there are employment relationships. On average the tribunal deals with 900 unfair dismissals cases a year whereas Rights Commissioners hear about 120 such cases.

Some may regard it as heretical even to ask the question, are unfair dismissals a serious industrial relations problem? On the broad scale of the problems facing Irish business in 1993 — unstable exchange rates, astronomical interest rates, over 300,000 people unemployed — the answer is no. Set beside notified redundancies averaging 15,000 a year the answer is again no. Unfair dismissal claims run at just over 1,000 a year on the basis of the combined Employment Appeals Tribunal Rights Commissioners figures. Taking the Employment Appeals Tribunal awards over the period 1988 to 1991, the average yearly sum payable on foot of awards is £421,000. That is not a high sum set against the wages bill for Irish industry. Allowing for the add on costs of legal fees, management time and out of court settlements, the annual cost is still relatively insignificant depending on the industry size.

This, one will admit, is a contentious view. It is put forward because in some instances the industrial relations practitioner will be operating in such an environment. It is far from being the whole answer. While the numbers involved may be small and the sums of money insignificant, the problems for the individuals concerned may be traumatic. As far as the organisation is concerned, if the contentious view was to prevail the result could be a disgruntled workforce, leading to consequent disruption. The pre-1977 Act industrial dispute figures bear this out.

The true answer is that it is a serious industrial relations problem, even if masked by the current problems facing Irish industry. Judging the success-failure ratio against three criteria — success in having the claim allowed, success in getting the job back and success in obtaining financial compensation — employees who allege that they are unfairly dismissed can hardly feel encouraged to pursue claims. Again a perusal of the tables shows the yearly details. The figures for 1992 are not yet available but inquiries give no reason to believe they alter the picture.

One in five claimants is successful in having a claim allowed and one in four is unsuccessful. These stark conclusions are, perhaps, distorted as 60 per cent of all claims are withdrawn before or during hearing. The outcome of these withdrawn cases can only be known to the parties but, if experience is any guide, many end up with the claimant receiving monetary compensation but not re-employment. Nevertheless, the success-failure ratio can only be judged in absolute terms. A success ratio of 20 per cent can only be regarded as failure on the part of claimants.

There is debate as to whether the objective of an unfair dismissal claim should be re-employment or compensation. In the light of the compensation figures and considering the present state of the employment market, re-employment — and for this exercise the difference between re-engagement and reinstatement does not matter — would seem to be the correct objective. Over the years 1988 to 1991 out of 3,500 claimants only 202 got their jobs back, a mere 6 per cent of the total.

The average compensation paid to claimants who are successful in having their claims allowed is not such as to encourage any but the most determined to pursue a claim. Over the previous four years there have been only three awards in excess of £30,000 and only one exceeded £40,000. The average award over the same four years was £3,149 and nothing in a review of the 1992 cases reveals a change in this trend.

It will be said that the tribunal can only award a claimant compensation not exceding 104 weeks' remuneration. It will also be said that the award is compensation for the actual financial loss suffered and not damages. Taking the average wage for male workers at £270 per week and for females £160 per week, it is of interest to note from 1991 figures that only five claimants were awarded £10,000 and only one between £7,000 and £10,000. In the same year 14 successful claimants received awards of between £401 and £500; 28 were awarded in the range of £1,001 to £2,000. This may represent a fair assessment of the compensation to which the dismissed employeee was entitled. For those who consider themselves unfairly dismissed and are involved in the hassle of pursuing a claim these figures provide food for thought. According to the figures compensation seems to be the norm.

This is a modest Bill that will benefit all sides. It will create a balance between employers and employees. The Minister said discussion is better than confrontation. That comment is appropriate and timely for those in industry and it is a pity it is not applied more often. I do not agree that the provisions of the Bill hinder employment creation and the figures available support my view. I welcome the Bill.

I would like to express my delight that the Seanad has been given the opportunity to initiate this legislation. It is a worth-while Bill and I am glad to speak in the debate. I express regret that there are not more Members present for the initiation of the Bill; I hope that will be rectified at the later Stages of the legislation.

The Bill covers substantive and technical matters and it is in essence a review of the unfair dismissals legislation introduced in 1977. It is important to point out that this amending Bill is necessary because of defects in the legislation which have come to light over the years. This Bill fulfils a promise expressed in the Programme for a Partnership Government and what was agreed in section 9 of the Programme for Economic and Social Progress. This legislation is close to my heart as a Labour Party Senator. It is a valuable addition to the protection of employees.

The Bill contains 17 sections, each of which are important in their own right. I refer to section 5 which adds to existing legislation, that a dismissal is deemed automatically unfair if based on the race, colour or, for the first time, sexual orientation of the employee. As far as I am aware this is the first time that phrase has been used in legislation and it augurs well for future legislation.

This is an aspect of the Bill which, by virtue of its sexual connotations, has attracted media attention to the exclusion of other equally important issues in the legislation. For example, section 13 extends the scope of the unfair dismissals legislation to cover those employed through employment agencies. Prior to the Bill a worker who procured employment through an agency was deemed to be employed by that agency and had to look to the agency for compensation if unfairly dismissed by the organisation for whom he or she worked. That did not make sense and it did not take into consideration that an individual would have worked for different employers through the same agency. The change in this section is welcome.

Section 7 (2) (a) is also important. This allows a claim for redress up to 12 months where exceptional circumstances have prevented the lodgment of a claim. Through my work as a solicitor I realise that many people are unaware of their rights in this regard. They go through a traumatic period having been dismissed and it is often too late before they realise that they can initiate this move through the Rights Commissioners or the Employment Appeals Tribunal. It is necessary that this six month period be extended to 12 months. I welcome that provision in the legislation.

While I believe there is a lot lacking in this legislation in relation to unfair dismissals, there are several matters to which I would like to refer, for example, the use of the contract of employment which protects the employee. It clarifies matters for both employer and employee with regard to their respective duties and rights. Yet, such contracts are not widely used. People are often employed on the basis of a verbal agreement and when problems arise at a later stage there is no written documentation to back up one's position. There should be more emphasis on the use of contracts of employment in written form so that matters are clarified and each party knows where they stand with regard to their rights.

Another point which was referred to by Senator O'Toole is the lack of information and knowledge available to employees and employers regarding the rights and duties of both parties. It would be helpful if the Department would consider putting together a booklet which would spell out the basic floor of rights which apply to both parties and some simple procedures as to where one goes when dismissed. It would help in making people aware of what measures can be taken when the situation arises. In the long run it would act as a precautionary measure and thus avoid having to take matters to the Employment Appeals Tribunal.

I agree with Senator O'Toole when he recommended that the legislation needs to cover the Defence Forces. I understand they are, of necessity, in a special position but they are entitled to some protection in law. I accept the legislation may need to be amended to deal with their case.

I would like to speak on the rights of apprentices, something which has not been mentioned. I worked as an apprentice solicitor for several years before qualifying and legislation is needed to deal with this area of work. An apprentice is now protected with regard to trade union matters, but this legislation should also apply to them. It is a matter that needs to be considered.

The legislation does not cover a situation where notice is served on an employee. If an employee accepts that notice he or she is deemed to have resigned his or her post when, in fact, they have been dismissed. That matter must be dealt with. There is an anomaly here the Bill could have covered and perhaps it can still be considered.

Something which has not been mentioned so far is the right of a former employee to a reference. As I know from experience, that poses a number of problems for some employees. There should be legislation to cover that issue and give the ex-worker an entitlement to a reference following a hearing. It is a requirement in this day and age and it is not provided for in this legislation.

With reference to the Unfair Dismissals Act, 1977 businesses have evolved a procedure with regard to dismissal. In many cases they have adopted the procedure whereby the worker is given an initial caution and the right to a hearing. Several procedures have evolved over time to deal with what may be a dismissal and in many cases it has helped to avoid dismissals. That is helpful and should be encouraged where possible. It should be provided for in legislation.

Every section of this Bill deserves attention because each has an important role to play. Each section refers to areas of reform that were seen as necessary while operating the original unfair dismissals legislation. Section 3, for example, allows the Rights Commissioner to examine subsequent fixed term contracts and fixed purpose contracts. It prevents an employer avoiding the unfair dismissals legislation by using a fixed term contract which would be reintroduced at a later stage. A Rights Commissioner can now decide if he or she sees a second fixed term contract coming through that it has been used to get round the unfair dismissals legislation. This is another important amendment to the legislation.

In section 4 we see a lock-out can now be deemed to be a dismissal and legislation in relation to unfair dismissals automatically applies to that. That should be the case in fairness and I welcome that change.

I have already referred to section 5 and the matter of sexual orientation being considered for the first time as unfair grounds for dismissal. This section reinforces the concept of procedural fairness by providing that the Rights Commissioner, the Employment Appeals Tribunal or the Circuit Court can have regard to the reasonableness of the employer's behaviour. Senator O'Toole said that the matter did not take account of the conduct of the employee but that is automatically considered in the legislation itself.

Section 6 is important and provides for a basic financial award for unfair dismissals in certain circumstances. Compensation is normally only payable where one is deemed to have suffered a financial loss. A person may be dismissed and, unusually, happens to find a new job on the next working day. No financial loss is suffered yet she or he has been unfairly dismissed. This legislation allows such a person to claim compensation for the first time and that is a necessary provision.

Under section 6 (2) (c) referred to earlier by Senator Hillery, the system of calculating financial loss on payments to the employee will now disregard any payments made under the social welfare and income tax codes. That is necessary because the system for calculating payments is complicated. I have a major problem with the fact that compensation payments are still not sufficient under the present regulations and do not deter an employer from deliberately dismissing an employee on the grounds that it is financially more rewarding for him or her to do so. In section 7, we see that from now on the Rights Commissioner, in awarding reinstatement, re-engagement or financial compensation, which are the three remedies available for unfair dismissal, must state why the other two forms of redress were not awarded. In many cases people may say the reason is understood, but it needs to be spelt out. This section places an onus on the tribunal to decide why an option such as reinstatement is not possible and, therefore, will help to detect where the blame lies.

Under section 7 (2) (b) a person now has 12 months to initiate a claim for unfair dismissal. This extension is valuable because it brings the situation into line with other legislation. Six months was an extremely short period and in practice excluded many worthwhile claimants, who found themselves out of work but did not initiate, or have the knowledge to initiate, a claim. There is also a time limit now for objections by a party to the hearing of a claim by a rights commissioner. Under the 1977 legislation one could object to a hearing, but the new time limit is worthwhile because it helps to speed up procedures towards a swift conclusion which benefits all parties concerned.

The Employment Appeals Tribunal can under section 7 (4) issue a determination confirming the recommendation of a rights commissioner in circumstances where the employer concerned has not implemented the decision of the tribunal. I query the point of going through the same procedure again?

May I bring to your notice, A Chathaoirligh, that I understood there was a time limit on speakers in this debate. I am getting annoyed that the restriction on speaking and on the right to speak as it stands, means many Senators will not get an opportunity to do so.

Acting Chairman

To answer the first part of your question in relation to duration, each spokesperson has 30 minutes. Senator Maloney was the first person on the Labour side to make a contribution and is therefore entitled to 30 minutes. He offered to share his time with Senator Gallagher. Senator Maloney contributed for ten of the 30 minutes which leaves 20 minutes for Senator Gallagher. She has another five minutes to speak. In relation to the restriction on time, the time allocations were agreed on the Order of Business this afternoon.

May I ask, if a restriction was placed on the spokespersons sharing their time?

Acting Chairman

No, that is a matter for the contributor and does not necessarily require the agreement of the House. Usually, by tradition it would be put to the House, and it was.

I appreciate being given the opportunity to air my views on this important legislation. Section 7 (11) prevents an employer using under the table payments to an employee as an excuse, or a way of avoiding the legislation, when that employee is subsequently unfairly dismissed. I welcome that and the fact that it will be reported to the relevant bodies. That will make employers more aware of the fact that they cannot avoid the scope of legislation in the way they have sought to do to date.

Section 10 allows flexibility to an employee to change his or her claim as regards taking it through the Rights Commissioner, the Employment Appeals Tribunal or directly to the courts. That is necessary because it could transpire at a later stage that a case may have been more suited to a particular hearing. This amendment will allow a person decide whether their claim belongs before the Tribunal or should be dealt with under common law for wrongful dismissal, through the courts.

Section 11 provides an avenue of appeal to the Circuit Court regarding the determination of the tribunal. Where an employer fails to implement an order of the Circuit Court or a determination of the tribunal which has not been appealed, the employee or the Minister can apply to the Circuit Court for an order directing the employer to implement that determination. That measure is necessary if we are to take this legislation seriously. There is no point in having this legislation if an employer can flout it deliberately and ignore orders made by the relevant court or tribunal. That worth-while procedure must be followed up on and be seen to be acted upon, and not simply exist on paper. The Minister must make sure that employers are not allowed to flout this law.

I note that if an employer decided not to pay out compensation awarded, interest would be payable on the award as a deterrent. The court can change an award from reinstatement or re-engagement to financial compensation where the original determination by the tribunal for reinstatement, for example, has not been implemented. That is necessary because only at that stage will it become known whether re-employment or reinstatement is a real option. In those circumstances the order should be changed to allow for a direct payment of financial compensation. I would stress, however, that compensation payments are not sufficient and do not deter an employer from unfairly dismissing an employee who must have been employed for at least a year for the legislation to apply to him or her.

There is a flaw in such legislation where only between 20 and 25 cases order reinstatement or re-engagement. On that basis we must look more seriously at the levels of financial compensation payable. The increases in the legislation to date are not significant as the chances of a person, deemed by the court or the EAT to have been unfairly dismissed, of getting a new job are slight. On that basis, the compensation is not sufficient and must be looked at seriously.

Apart from that criticism, I welcome the legislation although there are several areas not covered in it. I will welcome discussion on it at a later stage. This legislation is much needed and I am pleased it is being introduced in this House.

Acting Chairman

Due to the list of speakers, it is unlikely the debate on this Bill will be concluded this evening. If Senators do not get an opportunity to contribute today, the debate will be adjourned at the agreed time of 6 p.m. and the Whips will decide when the debate will be resumed.

I welcome the fact that the Bill is being initiated in the Seanad and congratulate the Minister for agreeing to do so. I am delighted to see her in a new role because I recall many useful discussions on legislation when she served as Minister in other Departments. Her commitment to the Seanad has always been one of facilitating Members.

The Bill is very technical. It is a Committee Stage Bill, and that was made clear by Senator O'Toole's contribution. It is a Bill which will require detailed discussion at Committee Stage. Therefore I will not be using all my time on Second Stage. I have listened to Senators' contributions and there is nothing with which I fundamentally disagree and I do not want to engage in repetition.

Having listened to the two previous speakers, both members of the Labour Party, it occurred to me that a little history in relation to this could be useful. The Unfair Dismissals Bill was also introduced by a Labour Minister, former Deputy Michael O'Leary, in late 1977. At that time, the Labour Party were in coalition with my party. In so far as the Minister was generous in her praise of the effect and value of the 1977 legislation, I accept that praise on behalf my party's involvement in initiating it.

Do not label me Labour; the Senator said it was also brought in by a Labour Minister.

My phraseology might not be quite right. It was brought in by a Minister who was a member of the Labour Party.

I have one small technical point to raise. The Bill is entitled "An Act to amend and extend the Unfair Dismissal Acts of 1977 and 1991,..." I have difficulty finding the 1991 Act.

It is the part-time workers legislation.

The 1977 legislation is a milestone in labour relations. The figures quoted by the Minister indicate the value of that legislation. It created better relations between management and labour and established fair treatment for employees. In so far as this legislation improves the 1977 Act, I welcome it.

In legislation of this type, it is important that the position of employers is also considered. We must recognise that it is crucial to maintain a balance. Senator Hillery said that the responsibility and duty of legislators was to hold centre stage and maintain the balance between different interests. If I did detect — it might be mistakenly — an anti-employer voice in some contributions, I want to reject it. I admit that some employers have caused problems but it is wrong to generalise.

It is important that we are fair to all sides and we must recognise that, with 300,000 unemployed, no unnecessary barrier should be created that would affect employment creation. I want to know what consultation the Minister has had with employers organisations and what their attitude is to this because they obviously have a position on it. The Minister stated that she had consultations with IBEC; she might develop on the content of those consultations in her reply.

There is always a risk that, if one takes a certain line or appears to be less than supportive, one is considered to be anti-worker. That is not my purpose. My purpose in raising questions is to ensure there is balance in the legislation. I am an employer admittedly on a small scale, and I have never dismissed an employee. I have one person employed since 1970 and another was in my employment for 23 years and retired recently. I have always believed in team spirit. It is important that employees share in the success and achievement in any enterprise in which they are engaged. Where that attitude exists difficulties rarely arise, and it is possible to achieve that attitude in any enterprise large or small.

I am aware that employees have been badly treated and that there has been need for this legislation. I do not dispute that. However, I am also aware that some employers are unwilling to take on extra workers. Among the reasons being advanced for this, rightly or wrongly, are the constraints imposed by labour legislation. The prevailing attitude for the past ten to 15 years has been that it is a progressive move to replace a worker by a machine. That has been a fundamental mistake in our approach to employment. State policy has encouraged that kind of development by grant aiding the installation of machinery or equipment that displaces workers, while penalising labour-intensive industries through taxation policies that discourage employer and employee alike. That policy is still being implemented today.

I have made these general observations in the interest of balance. Along with other Senators who spoke, I welcome section 5 of the Bill, which extends the scope of section 6 (2) (e) of the principal Act to include sexual orientation as an unfair reason for dismissal. I will not repeat what has been said already, but I agree with the comments made and I congratulate the Minister for including that provision in the legislation.

I also welcome the inclusion of temporary health board officers within the legislation. Other comments I have to make — and I am conscious that we are going to have a discussion on Committee State — relate to the possible negative effect of some sections. I refer to them only in a general way to give the Minister advance notice of my concern and so that we may avoid prolonged discussion on Committee Stage.

Section 6 extends the provision for payment of financial compensation, where a dismissed worker is replaced by another. I understand this provision but I wish the Minister would comment on it in more detail. I have difficulty understanding subsection (2) (a). I am unclear about what it proposes. Section 7, encompasses many matters. There is provision under subsection (4) (a), permitting a tribunal to reach a conclusion without hearing the employer. When a body, such as a tribunal, is adjudicating on a matter, it is in conflict with the principles of basic justice to deny one side the opportunity to present its case in full. Therefore, I am concerned that the tribunal may reach a conclusion without hearing the argument on the employer's side. Section 7 (11) and (12) are an attempt to deal with what is generally called the black economy. If that is so, I would like the Minister to confirm it in her reply.

It is. Has the Senator waited two weeks to tell us?

Since the Minister said "yes" to that question, I respond by saying — and we can discuss it further in due course — that this is not the best way to approach the matter. In relation to what I said about creating balance that——

The black economy is operated by both sides now.


The black economy is often deemed to benefit the employee only. This is a patent reference to a black economy on behalf of the employer.

Senator Howard, on Second Stage.

Legislation should be dealt with through discussion like this.

I accept what the Minister tells me. There may be a better way to do it but that may be discussed again.

We will talk about it again.

My thoughts about what the provision might relate to have been confirmed. I am concerned about section 13 and the position of employment agencies and employers arising from that. Responsibility is pinned on employers here, whether they are paying wages or not. I noted that the Minister in her response to another Senator on this matter confirmed what I felt to be the position. This provision is unsatisfactory and I hope to deal with it at greater length on Committee Stage.

We must be careful not to let unnecessary bureaucracy obstruct the creation of jobs. That may not be the case here but it may arise in the context of section 13.

The assessment of compensation, has been referred to by Senator O'Toole and Senator Gallagher. I cannot reconcile myself with one part of their contribution. I am not disputing their interpretation but where no account is taken, for example, of social welfare payments received by an employee during the period for which compensation is being assessed there is an element of double payment in that situation. A clawback provision is required in relation to such payments if my understanding of the section is correct. Unless more thought is given to this aspect I visualise problems arising from the provisions of that section.

I understand from the Bill that it is possible for employees to claim compensation under a number of headings — perhaps two or three. They can initiate a claim under several headings and then elect to proceed under one heading only. In the meantime considerable costs may have been incurred by the employer in preparing a defence under two or three headings. We should attempt to clear up this unsatisfactory matter.

My final question is in relation to illegal contracts. That is my term, but the Minister knows what I am talking about. In the provisions relating to illegal contracts it appears that balance is lacking since greater shelter appears to be provided for the employee. I suggest to the Minister that both parties should stand equal in relation to any transgressions with regard to the Revenue Commissioners. There is a certain lack of balance there.

At one stage I said that a person who raised the questions I have raised would risk being accused of being anti-worker. I mentioned my own situation as an employer to show that was not my purpose. The purpose of this House and my reason for speaking is to ensure that we put balanced legislation through the Seanad.

I welcome this legislation with which I have no disagreement. I have expressed my views solely for the purpose of improving the Bill. I thank the Minister for initiating this legislation.

I welcome this legislation and applaud the Minister for her initiative. It is enlightened legislation; indeed, many of our European partners do not have comparable legislation.

Discrimination against minorities is vile; unfortunately it is part of living today. In the context of the re-emergence of fascism in certain parts of central Europe and especially in Germany, the results from one of the Länders, the state of Hesse, in the past few days sent a shiver through those of us committed to democracy and parliamentary activity. A party led by a former SS officer will now take its place in a parliamentary forum in a member state of the European Community. This officer, like his contemporaries, was responsible for locking up and executing many people on the grounds of religion, a well as the old, the infirm and the handicapped. Those whom the Germans called the Untermenschen, the sub-humans; anyone who was not Germanic, who was the wrong colour or whose sexual orientation was considered abnormal, as well as people of certain national or ethnic origin, for example, gypsies, all suffered.

In the Irish context the people who are marginalised in our society are now acknowledged in this Bill. I applaud the Minister for putting this legislation in an historical context and in the context of what is happening in Europe today where we are sometimes disadvantaged because of our peripherality. In other areas of life, particularly in the quality of life, we are sometimes better off than our European partners. In enshrining these proposals in legislation we are making a statement as a people to our European neighbours and the world that we do not condone discriminatory measures against minorities. For that reason alone I applaud the Minister for introducing this legislation.

I am also pleased the Minister is introducing this legislation because it impinges to some degree on my professional activities as a broadcaster. This area will now be covered under short term contracts and this is another aspect of the legislation. Although I have been broadcasting for approximately 15 years with RTE I have been on a short term contract all that time. I am not and never have been a member of staff. The contract has ranged from four to eight weeks, where it currently stands. The fact that it is continuous means that when this legislation becomes law my position will be strengthened. This legislation will also benefit people employed in RTE and the local media, school leavers and others who may be able to renew short term contracts for a further period. They will come within the scope of this legislation.

Will you threaten me on them now?

If the question of termination of employment arises, and please God it will not, I will threaten the Minister on the powers that be, in case they might contemplate terminating my services.

I suppose we are all in temporary employment in these Houses.

Yes, especially in this House.

The definition of a part-time worker is something which also interests me.

My contract states — and I am raising this because it is relevant to the legislation — that I am employed for the duration of my broadcasting period on air. It also says that I should make myself available for rehearsals and preparation time prior to going on air. I am actually paid for being on air as well as the preparation time. How does one define that work? This applies also to many others in a similar position. The hours are eight hours. This is a definite improvement on the original 1977 Act, when it was 18 hours.

This improvement — I am sure the Minister will correct me if I am wrong — caused a furious reaction among some employers at the time of its introduction. This would seem to suggest it was a step in the right direction. In the context of the contract I have outlined to the Minister, I am curious to know if the eight hour rule will remain or if it will be further reduced. I only raise this question in the context of my own case. Many of my colleagues are employed specifically for their time on air. If I brought an unfair dismissal claim before the Employment Appeals Tribunal and argued that although I spend 30 to 45 minutes on air the actual time it takes in the overall context is over eight hours, would my employers reject this argument? I know the law attempts to legislate for the majority and there will always be exceptions.

I do not want to raise a political hare, but I notice that section 3 of the Bill makes provision to include temporary officers of health boards and deletes the obsolete reference to a committee of agriculture. Is this a political statement of intent?

I spoke about that already.

The abolition of the county committees of agriculture, as the Leas-Chathaoirleach and many of our colleagues in local authorities will know, has been a source of angst. If this wording is now enshrined in the legislation it indicates that perhaps the county committees of agriculture have been consigned to the dustbin of history. As the Minister said, she is aware of the implications.

Section 13 extends the scope of the unfair dismissals legislation to include persons employed through employment agencies. At another time I was employed by an employment agency in London for four or five years. I am an associate member of the Institute of Employment Agency Consultants and I am aware to some degree of the practice — especially in the nursing sector — where agencies employ people on what is called agency work. I am pleased the legislation will now define that the organisation where the person works is deemed to be the employer of the agency worker. I know this caused some difficulties.

Debate adjourned.