Dáil Éireann Debate, Thursday - 16 July 2020
8. Deputy Louise O'Reilly asked the Minister for Finance if his attention has been drawn to employers that are paying their employees 70% of their wages using the TWSS but are making them work 100% of their former hours; his plans to address the matter to ensure that workers are paid for 100% of the hours worked; and if he will make a statement on the matter. [15751/20]
View answerI join others in wishing the Minister well in his new role. Is he aware that in some instances employers are paying their employees 70% of their wages despite requiring them to do 100% of their work while availing of the wage subsidy scheme?
Deputy Paschal Donohoe: I thank the Deputy. I am advised by Revenue that the question of an individual’s entitlements in an employment context, and the question of what wages an employer may or may not be in a position to pay such an employee in light of the impact of the pandemic, are matters that are outside the remit of the scheme. The scheme has no role in the employer-employee relationship insofar as the terms, conditions and entitlements of the employment are concerned.
The TWSS is provided for under the Emergency Measures in the Public Interest (Covid-19) Act 2020. Of necessity, the legislation was developed quickly, having regard to the objective of getting financial assistance to employers and employees. It is predicated on the employer wanting to keep the employees on the payroll and retain them until business picks up. The amount of the subsidy for each employee is based on his or her average net weekly pay reported for January and February 2020. However, the employer is expected to make the best efforts to maintain the employee’s net income reflected in the average net weekly payment for January and February 2020 for the duration of the scheme. At the same time, there is no minimum amount that the employer must pay as an additional payment to be eligible for the scheme, but for Revenue operational systems reasons the employer will need to enter at least €0.01 in gross pay when running its payroll.
Finally, details of subsidy payments made by pay date are available to view in each employee’s myAccount record on Revenue’s online system. This facility allows employees to see whether their employer is participating in the scheme and being refunded a wage subsidy on their behalf. Where the amount of subsidy paid is available from the relevant employer payroll submissions made to Revenue, that amount is also displayed.
Employees can see that and they do not need to the Minister to point them in that direction. They see that their bosses are getting the subsidy and their wages have been reduced by 30% while their hours remain the same.
The Minister said he will ask employers to make their best efforts. Good luck with that because many of them do not seem to be making an effort. This is not a significant problem, but I am interested in hearing from the Minister if he has a view on whether this should be tackled.
Sinn Féin proposed the implementation of an income support scheme back in March but that was not the route the Minister went down. Of course, we supported the emergency measures. We recognised the need for those, but now that these have been implemented there is surely a case to be made for them to be monitored. Employees are logging on and can see that their employer is getting a subsidy. They note also that they are working 100% of their hours for 70% of their wages. Does the Minister have a view about that practice and what he might be able to do about it?
The very reason the temporary wage subsidy scheme was introduced was to protect jobs and income. It has had a massive effect in doing that. It is possible that employers, because of the financial circumstances they are in and concerns they might have about their viability, may work with their employees in efforts to protect the future of their company and the jobs of people working in that company. They may ask them to take voluntary pay cuts or to make changes to their work arrangements to protect jobs and protect the viability of their company. If that is to be done, it is to be done for one purpose only and that is to keep a job, to keep an employer in operation and to keep a firm in existence so a job is available tomorrow. That is the only reason those changes should be made, and I and the Revenue Commissioner have been clear that if we become aware that the temporary wage subsidy scheme is being used by employers for purposes other than that, they will be subject to enforcement action by the Revenue Commissioner.
The Minister talked about protecting jobs and that is important. The reason we supported the passing of the emergency legislation was to do exactly that, but not to protect jobs at all costs and not to protect employers who seek to exploit this scheme by claiming money from the State and forcing their employees to work 100% of their hours. It is all very well to say there should be an agreement between the workers and the management and the business owners, but what if that does not happen? These are vulnerable workers. They want to keep working but they are working for 70% of their wages, in some instances without their agreement. They have come to us, and I am sure to the Minister in his constituency office, to advise that they believe it is not fair that their employer is benefitting from a State scheme.
Does the Minister agree that this is an anomaly? Will he agree to examine this and to insert a clause into the scheme to ensure this cannot happen? I stress that it is in the minority of cases, but where it is happening it is not right and it should be stopped.
The purpose of this scheme is to protect jobs. That was the overriding objective I faced at the time that I introduced it. It is possible that companies are reducing the wages they are paying their staff because their revenue has gone down, they have lost clients and they are worried they might not be around tomorrow. That is the reality facing those who are working in those companies at the moment and those who own them. They are worried about their future and whether their company will still be around. Those people in those companies are deeply concerned about whether they will have a job. Therefore, it is possible in those circumstances that wages will be reduced for a period to give a fighting chance for the job to be kept and for the employer to continue into the future. That is the only reason that should happen. The purpose of the TWSS is not to facilitate wage reductions on behalf of employers who might have other motives. The purpose of the scheme to keep people in work.
The Member who tabled Question No. 9 is not here. We will move on to Question No. 10 in the name of Deputy Doherty.
