Unfair Dismissals (Amendment) Bill, 1993: Committee Stage.

Section 1 agreed to.
Question proposed: "That section 2 stand part of the Bill."

I am not sure of the reason for the change in this section.

"trade union" means a trade union which is the holder of a negotiation licence under Part II of the Trade Union Act, 1941;

Why is it so restrictive? I have looked at the legislation but the reason for the change is not clear.

The Senator is asking about the definition of "trade union" and why it is used so restrictively. This definition is used in the Industrial Relations Act, 1990. To maintain consistency in employment legislation, we retain the same terminology.

I want to make it clear on Committee Stage that I intend to raise issues on sections and amendments. I would like to know if something not included in that line was included in the Principal Act?

No problems have been encountered with the definition in the 15 years since the first unfair dismissals legislation. This change, in addition to being consistent with the 1990 Act, is considered necessary to avoid problems with the existing definition. There is no hidden agenda. While no problems have arisen with regard to the 1977 legislation we want to retain consistency in terminology so that interested parties — employers, employees and the public — will understand the precise nature of the term.

While not disagreeing with section 2, there is one aspect which should be brought to the Minister's notice. We know what the term "trade union" means and that a high percentage of employees are represented by trade unions. However a number of employees are not. It has come to light that many of those employees, should they bring a case to the tribunal, do not get free legal aid and they cannot afford legal expenses. Perhaps the Minister would deal with this issue of free legal aid.

First, everybody can seek redress, whether in a union or not. There is no circumscribed group of people who may or may not seek redress. The point is to keep legalism out of the proceedings. I accept the point made about free legal aid. People, in unions and outside them, have told me that they do not like the increase in legalism in the Employment Appeals Tribunal because it was established to bring simplicity and clarity to the proceedings. By introducing legalism, one negates the purpose of the Employment Appeals Tribunal. I am meeting the members of the Employment Appeals Tribunal in the near future and I will discuss these matters with them.

To answer the Senator's point, no one is excluded from seeking redress. To do so would be the wrong way for anybody to attend the business. The route of legalism is not the right route.

I am pleased to hear what the Minister has said about reducing legalism in this area. I made this point on Second Stage. In view of what the Minister has said, I am sure she will accept some of our amendments which try to reduce legalism in industrial relations legislation.

I have listened to the Minister and I agree with everything she said. What is the difference between us? The Principal Act says that a trade union means a trade union granted a licence under the Trade Union Acts, 1941 and 1971. As the Minister says — and she may correct me if I misquote her — this definition has worked perfectly. Now there is an amendment to change the definition in the Trade Union Acts, 1941 and 1971 to one section of the 1941 Act. I want a reason for this. If I am being suspicious, I apologise. Could the Minister assuage my fears and explain to me why this change was brought into the early legislation and why, in this Bill, we decided to change the interpretation in the Trade Union Acts, 1941 and 1971 to one part of the 1941 Act.

The Senator did not hear me correctly.

Although I said no difficulty had arisen, this definition is more comprehensive because it covers all the trade unions defined in industrial legislation and in industrial relations legislation. The definition in the Principal Act may not have covered every trade union in the country, for example, English based unions, because the definition did not refer to the Trade Union Act, 1975. This is the most correct and precise definition which can be obtained.

I wish to make a point about legalism. I confirm the thrust of what the Minister has said. The existence of legislation facilitates employers and employees to resolve disputes without recourse to the law. In other words, the best way to handle disputes is to prevent them and to allow people in the workplace to resolve them at that level. The existence of legislation avoids legalism.

Second, this is a technical Bill and the Minister underlined this fact. Legislation, including this Bill, should be kept as simple as possible. In that context, there is everything to be said for a simple guide to the legislation. We should have minimum legalism and simple legislation.

I agree with the Minister's view that the legalisation of the Employment Appeals Tribunal should be avoided. Unfortunately, that is not the way the Employment Appeals Tribunal has developed. It has become legalistic. It is now unusual to attend a tribunal where a solicitor and a barrister do not represent both sides.

We do our own business.

I am not speaking from any section of the Employment Appeals Tribunal or from any section of the industrial relations area, but from my experience of the Employment Appeals Tribunal. It has become overly legalistic. The original intention was that an employee could take his own case, without any representation, and the Employment Appeals Tribunal would be sensitive to the position of the employee and would elicit all the facts from that person. If the tribunal could develop in that way, it would be better than the present situation where legal people debate the facts at length, while sometimes confusing the issues. Two of the three members of the Employment Appeals Tribunal are lay people who often seek guidance from the chairperson because the tribunal has become so legalistic. It was not meant to be that way.

It was never meant to be like that.

I raised this matter because people who have not been represented by trade unions have failed miserably in their efforts to gain redress as they did not have representation at the Employment Appeals Tribunal. Where would they get representation? The immediate reaction of a person who is unfairly dismissed and who is not a member of a trade union is to seek legal advice because they do not know anything about the Employment Appeals Tribunal. If a person deems it necessary to have legal representation — and I do not want to be overly legalistic in these matters — they should be entitled to it. Sometimes an employer will be accompanied by a solicitor and barrister. In that case what chance has an employee without trade union representation? I ask the Minister to consider this matter with a view to providing free legal aid for people in these circumstances.

I know that any points Senator Sherlock raises are based on what he sees as people's rights. However, what he is urging me to do would have a negative effect on the workings of the Employment Appeals Tribunal. The Employment Appeals Tribunal was meant to be accessible, understandable and simple. Legal aid is advocated for people who are unfairly dismissed and I know who is advocating it. However, that is not Senator Sherlock's view. If we go that route we would negative what is meant to happen in the Employment Appeals Tribunal and it would be contrary to the spirit and thrust which was inherent in the setting up of the tribunal. I am meeting the chairman and the members soon to discuss this issue.

One issue which has been mentioned to me by the trade unions and other interested parties is the increasing legalism in what was meant to be a free and unfettered expression of views. I know the stance which Senator Sherlock is taking and I assure him that the format of the Employment Appeals Tribunal was never meant to be one in which there would be increasing legal representation.

Question put and agreed to.

I move amendment No. 1:

In page 4, between lines 18 and 19, to insert the following:

"(a) the substitution of ‘nine month's' for ‘one year's' in paragraph (a) of subsection (1).".

This legislation has worked well to protect people who might have been dismissed or sacked over a period of time. One issue which arises time and again is the one year period before people are entitled to avail of the legislation. Prior to the Principal Act, this legislation, or amended legislation, an individual who was sacked from employment and had not been treated equitably within the boundaries of common law and natural justice would have tried to take a case under common law and under the principles of natural justice.

It has been the experience of the trade union movement that this legislation has been used by a minority of unscrupulous people who have avoided the one year term of qualification. A person must be employed for one year before they can avail of this legislation if they are sacked. There are a number of reasons why there should be a specific period. An individual may be appointed to a position and, despite the best methods of filtration, the most comprehensive system of interviewing and the most supportive methods of probation he may be unable to do the job. An employer must have the right to deal with that situation.

There is nothing sacrosanct about a year. It is easy to avoid this legislation — yearly contracts are being used for this purpose. An individual in employment for more than six months will have established himself or herself sufficiently for the employer and fellow workers to know if he or she is able to do the job. The one year period should be reduced to nine months. An individual in employment for nine months should have access to this legislation if dismissed and should be enabled to appeal.

A person in employment for less than one year may challenge dismissal, but may not do so under the unfair dismissals legislation. People may challenge dismissal by seeking a judicial review or legal redress under common law or the principles of natural justice. It would be easier for everybody, including the employer and employee, if this matter could be addressed. I would like to see the period of one year reduced to nine months.

I support the point made by Senator O'Toole and I ask him to change his amendment to reduce the time period to less than nine months. I do not know whether this may be permitted. In a number of jobs the probationary period is three months; in others it is 12 months. If a dismissal is wrong after 13 months it is equally wrong after three months. I ask the Minister of State to address this issue. Three months is an adequate period of time to assess an individual's competence. I support the amendment.

The White Paper on unfair dismissals highlighted interesting figures in relation to other EC countries. For example, the time period in the UK is two years, in Denmark it is one year, in Germany and Italy it is six months and in the Netherlands it is two months. Employers argue for one or two years while trade unions argue that six months is sufficient time to assess a person's suitability. I believe that the time should be reduced from one year to nine months or six months. Under existing legislation the time period for apprentices is six months.

The time period may vary depending on the occupation and skills of the people concerned. Employers, collectively, would like to see a period greater than one year. Based on observation and experience I believe one year is reasonable.

Employing people is an important decision. Job security is important and an employer worth his salt would wish to keep somebody in employment. There are several occupations and professions where one year is necessary to assess the suitability of the person for "permanent" employment. It is a reasonable compromise, bearing in mind the demands made by employers for a period greater than one year. In some occupations one year is necessary.

I looked at this Bill with a view that takes into account fairness and the avoidance of unfairness. It takes into account the problem of unemployment. If we are to encourage employment, enterprise and job creation we must not place obstacles in the way.

I support what Senator Hillery said regarding a sensible attitude. The Bill and many of the amendments are worthy of consideration. However, it is easy to understand the use of the one year period, given attempts to make the legislation understandable, intelligible and sensible. A one year time period is a fair compromise that will be accepted on all sides.

A six month probation period should be adequate for any employer to assess a person. A person should, at that point, have the same rights as other employees.

I hope the Minister will forgive my inexperience, but does this legislation cover part-time workers?

Legislation relating to part-time workers was enacted about two years ago and it gave them all these rights.

I thank Senator O'Toole for moving this amendment and the Senators who have spoken on it. I will outline the background to this section and the amendment which we are discussing. The Unfair Dismissals (Amendment) Bill, 1993 was introduced as a result of consultations between employers and trade unions. That is to be expected because at preparation stage one seeks to hear all the views. The Bill was the result of a consultative process and a compromise between various points of view.

Employers sought to introduce a two year period, bringing it to the UK level, while the trade unions sought to reduce it to six months. In Denmark, a country which prides itself on its humanitarian and socially advanced legislation, the time period is one year. Last week in Denmark I spoke informally to the Danish Minister for Labour Affairs about their legislation. The Minister told me they have no plans to change the time period from one year.

I recognise that Senator O'Toole is seeking a compromise on this issue. Since the 1977 Act, the one year guideline has operated satisfactorily and there will be no need to come back to this House or the Dáil to change it. I will keep a close watch on this legislation and on this provision. If in the course of my tenure of office, this issue needs to be addressed, it can be done by order of the Minister. I intend to keep a close watch on all labour legislation and to consult with the relevant bodies. If the need arises I will attend to it but as of now, this is the best route to follow.

I would like to raise two further points. I want to clarify the position regarding the employer. I have discussed this amendment with some of them and the beauty of this legislation is that it gives a straightforward course for those who wish to challenge their dismissal. There is a similar path for employers who feel that they have acted honourably and correctly. I have been on both sides on this matter, as chief executive of a large organisation as well as the leader of a trade union. There is a great sense of satisfaction in knowing that one can check the stages one after the other. The employer makes his case for dismissing the individual and it is either an acceptable position or not. That is a help to both sides because it gives a clear position. I do not want this to be seen solely from the worker's point of view. This is the beauty of the legislation.

What about the worker who is dismissed after six months in employment? There is a view around the Chamber that, if they are less than a year in employment, they do not come under the terms of the Unfair Dismissals Act and have no recourse. That is not the case. Everybody has recourse to the law at any time if they feel they have been unfairly treated, discriminated against or have been the victims of some iniquitous decision. The method of dealing with the matter is costly and cumbersome, both for the employer and the employee. Many people who are excluded under the terms of the Act have won unfair dismissal cases, even against the State.

I am trying to state the reality. Legislation was introduced in the first place, not in response to pressure from the trade unions, but because it was a difficult area to deal with. Those who wished to challenge a decision had to go through the cumbersome legal system. The Minister of State talked about diminishing the level of legalism involved in such cases and I support this. My amendment reduces that still further and is attractive to both sides.

There is an opinion among many in the trade union movement that the one year system in readily understandable, but that it is being used to exploit workers by only giving them 12-month contracts. It does not require employers to decide if they should be retained. There is a strong case for reducing the one year period for qualification under the Act. Those affected can then take claims and fight against what they perceive as an unfair dismissal. There is nothing sacrosanct about nine months either, but it is important that it be less than a year. I would have no difficulty with 11 months. There is a long standing Irish tradition about not using a year as a yardstick. Those of us from rural Ireland know——

Take land.

Conacre agreements are never for a year. There is precedent for using a period of less than a year for qualifying under the Act. The 12 month provision makes it easy to retain workers on contract and instills in them a fear that they will never be made permanent. If people dismissed after six or nine months feel that they have a grievance — they still have to prove their case — would it not be better to do it in this way rather than to have recourse to the law and clog up the courts, bringing excessive legalism into industrial relations, which does not help either side? There is a very strong case for reducing the period.

Let me take Senator O'Toole's point concerning employees. Although there are few unscrupulous employers, reducing the qualification from nine to six months would not stop those few from reducing that by a further month and so on. That is the way I view it. The Senator also spoke about the employer. I accept that he has had experience on both sides. I can only tell the Senator what the main group representing employers told me. They wished to make this period comparable to the UK period, which is two years. The unions and employees wish to change it to six months. It does not require further amendment because I intend to watch the future trend of dismissals. I will be glad to attend to this by way of Ministerial Order, should I see, after a close review of the Bill, there is a need to reduce it further. For the moment, we are leaving it at 12 months.

Amendment, by leave, withdrawn.

I move amendment No. 2:

In page 4, paragraph (a), line 21, after "temporary" to insert "or part-time temporary".

This might be already covered under the Worker Protection Act. Many working in health boards and vocational education committees are part-time employees who are temporary and work 20 to 25 hours, or less, a week. I know some who have worked for 15 years in health boards on this basis. If this amendment is not covered by this Act I will press my amendment.

I understand why Senators Neville and Doyle put down the amendment. It is in line with my approach on the matter and is already covered in the legislation. The provisions of the legislation will cover temporary officers in the health boards. Part-time temporary officers will also be covered, provided they are expected to work a minimum of eight hours per week, as set down in the worker protection Act. The Senators' intentions are good but they have already been met.

Amendment, by leave, withdrawn.

I move amendment No. 3:

In page 4, paragraph (b), line 33, to delete "3" and substitute "6".

This is a slightly different matter which pertains to holding someone in employment with short breaks. I did not press the previous amendment because an employer can as easily exploit or dismiss an individual, after 11 or seven months as after 13 months.

I do not want to mention any specific type of employment but where a specific skill is required for the operation of an institution, company or service it is not fair to employ workers on a one year contract. At the end of that contract the employer may decide to let the worker go for a few months to save holiday costs, and to re-employ the worker three months later. In a minority of cases this is done on a regular basis. It is all too easy to exploit the contract worker.

Whatever about the arguments which were made against my previous amendment there is a clear difference between six months and three months in terms of service being continued to be delivered by a company or institution; it can do without a specific skill for three months. After nine weeks an employee is recalled and a contract extended for another year. That happens.

To pre-empt the Minister of State's question of the difference between three and six months, it is impossible to implement that practice on a six month basis. If a contract worker is re-employed after three months it circumvents the Act. The period should be reduced from six months to three months.

It is the other way around.

I was speaking to the wrong amendment. It should be six months rather than three months. I should have read my own amendment. It is clear that the three month provision facilitates the exploitation of contract workers. I would ask the Minister of State to respond to this.

The purpose of this section of the Bill is to prevent the misuse by employers of fixed term contracts. There has been some concern, as Senator O'Toole said, in recent years that fixed term contracts are being used widely by employers in an attempt to avoid liability under labour protection legislation, particularly the Unfair Dismissals Act, 1977. The proposal contained in this Bill will allow the relevant adjudicative authority to decide if a second or subsequent fixed term contract was justified or if it was wholly or partly connected with the avoidance of liability under the Act. It allows for the examination of contracts where a period of up to three months might have elapsed between the termination of the first contract and the commencement of the next.

In specifying a period of three months I believe that I have been quite open to the views of the employee. This approach is warranted because there is some evidence that fixed term contracts are being used by some employers as a device to avoid liability under the Act. The three month period is a proper, workable length of time. Senator O'Toole's amendment seeks to increase the period to six months, so that for the purpose of ascertaining the reasonableness of a subsequent fixed term contract, the adjudicative authority could look at two contracts between which up to six months could have elapsed. I believe that six months is excessive and unnecessary and that three months is generally recognised as reasonable.

While I support Senator O'Toole's amendment I have some reservations that it may be counterproductive. I agree there is exploitation with fixed term contracts at present and sections of the public service are the main culprits. Could a situation arise now where people who have had long term employment on a monthly or three monthly contract basis have their employment terminated and not be re-employed as a way of avoiding the proposed six month stipulation? While I fully agree with the spirit of the amendment, I wonder whether it could be counterproductive?

The relevant adjudicative authority, the Employment Appeals Tribunal or the Rights Commissioner, would judge whether the employer had after several contracts unfairly dismissed the employee.

The point I am making is that if an employer intends to employ a worker on a monthly basis, for six or 12 months or even two years as happens regularly, they may now terminate that employment after two months so as to ensure they do not come under the Unfair Dismissals Act, 1977. The whole thing could be counterproductive.

If this amendment is accepted.

Section 2 (2) (b) of the Principal Act states that the Act shall not apply where a person is employed

for a specified purpose, being a purpose of such a kind that the duration of the contract was limited but was, at the time of its making incapable of precise ascertainment.

The Principal Act provides that people do not have to be contracted on a monthly basis. Workers may be contracted to do a job which takes longer than a year but it is a fixed contract. The time is not specified at the beginning but it is specified by the nature of the work, for example an engineer's contract to work on a bridge might last longer than a year. Section 2 (2) (b) of the Principal Act covers that issue precisely. I want to make sure my amendment does not actually——

I support the spirit of the amendment but I am questioning the effect it might have on the ground. I am inserting a note of caution; I am not disagreeing with the amendment.

It has been known for health boards to employ people on short term contracts for a period of up to ten years. The contract is renewed every month. However, if such a body wanted to avoid its responsibility under this Act it would terminate the employment after two months and employ somebody else. I am sounding a note of caution about counterproductivity. Employers will devise ways of avoiding their responsibility as they have done in the past. They could do so by terminating a person's employment and employing somebody else in the same role.

We are talking about the gap between the contracts. I know what Senator Neville is getting at but it is quite a different point to Senator O'Toole's.

I accept it is a different point.

The section of the Bill we talked about and Senator O'Toole's amendment refer to the gap between the contracts which is presently three months and which Senator O'Toole seeks to raise to six months. Senator Neville referred to employers employing workers for two months and then replacing them with somebody else. That seems a very cumbersome practice for employers, although the Senator is obviously speaking from his knowledge of health boards.

Nurses, for instance.

In the case of a person employed on a year to year basis whose contract is renewed at the end of each of two years, the employee may be let go each time and the contract not renewed for four months. This could go on for four, five or six years——

On a yearly basis?

——yes, on a yearly basis, and the person's contract is not renewed for four months at the end of the fourth year. There must be something wrong with that. I will not press the amendment, but there is a point to be answered.

I accept the case the Senator is making. The person in the sample is obviously suitable for the job, otherwise their contract would not have been renewed and yet they are let go for, say, four months in this case. The person in question can go to either adjudicative authority, the Employment Appeals Tribunal or the Rights Commissioner, and ask for redress. I hope there will be just one adjudicative authority soon.

I take it that this type of amendment arises because of the trend that has developed in recent years towards contracts negotiated between employers and employees. Am I right in saying that besides fixed term contracts? there are also fixed purpose contracts? If so, there must be reference to fixed purpose contract employment.

If someone on a fixed term contract, having been — in their view — unfairly dismissed goes to the Rights Commissioner or the tribunal, can that authority decide if their contract was justified in the first instance and, if not, deal with the appeal as if there was no contract? Is there legislation to cover that situation?

There is evidence that fixed term contracts are designed to avoid liability under the existing Act. I am not briefed on the fixed purpose contract, but I will contact Senator Sherlock about the point he raised.

Senator Doyle raised the case of a person who had been on a short term contract and sought adjudication in a perceived case of unfair dismissal and asked if the authority in question would examine whether he or she should have been on a short term contract at all. I do not think so. A person would go to adjudication to see if they should or should not have been let go. Whether the person should have been employed on a fixed contract basis would be the subject of another inquiry. It may well be that the Rights Commissioner or the tribunal consider that the case deserves looking at, but the person would not have gone on that basis. Normally, the person in question would expect adjudication on what they had put to the Rights Commissioner and not on the point raised, although I am sure it would not preclude it.

The Minister did not deal with my question. If a person went to the tribunal or the Rights Commissioner, could the authority in question, having examined the case, then say a fixed term contract had not been justified in the first place?

That was not the reason the person went to the Rights Commissioner. A person goes to the Rights Commissioner to have a particular grievance addressed and that is adjudged. The Senator is asking if the Rights Commissioner could then say the person should not have been on a fixed-term contract. This would not be the correct way for the case to be dealt with. If the person wished perhaps something could be done about it.

Amendment, by leave, withdrawn.
Progress reported; Committee to sit again.