Employers are required to maintain accurate records of employees and contractors who they engage and to pay the appropriate class of PRSI. There are already legislative provisions within the Social Welfare Consolidation Act 2005 prohibiting the practice of misclassifying employment in order to avoid paying the correct social insurance contributions.
Workers who have concerns in relation to their employment status have recourse to the Department’s Scope section. This section determines employment status and the correct class of pay-related social insurance (PRSI). Where misclassification of workers as self-employed is detected, the correct status and class is determined and social insurance arrears are collected as required. Depending on the length of time involved, this collection of arrears due in itself can impose a significant penalty on employers.
Given the concerns expressed in this House and elsewhere regarding a perceived increase in the incidence of self-employment, and to ensure that people are aware of their rights and the protections available, my Department conducted a communications campaign covering radio, print and social media, in relation to the issue of false self-employment during 2018 and will repeat aspects of this campaign again during 2019.
My Department has also increased the number of employer inspections in recent months with a specific focus on detecting cases of false/bogus self-employment. It is also implementing more intensive training for inspectors. Inspections are also undertaken jointly with other agencies including the Revenue Commissioners and Workplace Relations Commission. Where evidence of non-compliance is detected, it is pursued.
Recognising that that there is a particular challenge when dealing with large companies I have tasked my Department with establishing a dedicated team to deal with the work involved in such employer inspections and determinations and I expect to have proposals for this team by the end of April.
In addition, I intend to implement a number of new legislative measures.
Firstly, I will seek to put the Code of Practice for Determining Employment Status on a statutory basis. It is currently being reviewed and updated by an interdepartmental group from the Department of Employment Affairs and Social Protection, Finance, Revenue and the Workplace Relations Commission.
Secondly, I intend to bring forward measures to address victimisation of workers who seek a determination of their employment status.
Furthermore, I’m exploring the possibility of providing for Deciding Officers in Scope Section in my Department to make determinations on the employment status of groups or classes of workers who are engaged and operate on the same terms and conditions without having to investigate each individual worker separately. This would go a long way to ensure consistency of status decisions and their timely determination.
I hope this clarifies the matter for the Deputy.