Paul Murphy
Question:6. Deputy Paul Murphy asked the Minister for Enterprise, Trade and Employment if he supports sub-minimum rates of pay for young workers; and if he will make a statement on the matter. [31661/23]
View answerThursday, 29 June 2023
Questions (6)
Written answers
I want to thank Deputy Murphy for raising this with me today, I know we had a good engagement on this issue just a few weeks ago and I’m happy to continue this today.
Before I start I would like to put this discussion into context. In 2011, the minimum wage was €7.65 per hour. Today the full rate stands at €11.30, and we saw a 7.8% increase this year alone.
This work is happening alongside the commitment made by the now Taoiseach as Minister for Enterprise to move towards the introduction of a living wage by 2026.
As you will be aware, this in practice means a wage of 60% of hourly median wages. This is in line with the recommendations of the Low Pay Commission.
We are fully committed to ensuring that work pays, for every worker, and I think we have proven ourselves in this regard. Not only have we increased the minimum wage, we also adjusted the Universal Social Charge to ensure that the rise in the minimum wage was actually felt by these workers.
The Low Pay Commission is the independent body composed of employee, employer and independent members, which advises the Government on the setting of a minimum wage that is fair and sustainable and which will not have significant negative consequences on employment and competitiveness.
The Low Pay Commission previously undertook a review of the sub-minimum, or youth rates, as part of its work programme in 2017. At that time, it recommended abolishing the training rates that then existed and simplifying the youth rates by moving to age-related, as opposed to experience-based rates.
The LPC recommendations were accepted by the Government and introduced as part of the Employment (Miscellaneous Provisions) Act 2018. The LPC commissioned its own research, carried out by the Economic and Social Research Institute, and consulted widely on this matter before making its recommendations.
As some time has passed and we want to ensure that our legislation is fit for purpose in the context of significant changes in the labour market and the economy, last year the then Tánaiste and Minister for Enterprise, Trade and Employment requested the Low Pay Commission to again examine the issues relating to retaining or removing the youth rates and to make recommendations on the subject.
To inform its work, the Commission has again asked the ESRI to conduct background research on the issue. The Commission has also recently launched a targeted stakeholder consultation on the subminimum rates issue, which will also inform this work.
The Low Pay Commission’s report and recommendations on sub-minimum rates are expected later this year. The Government does not want to pre-empt its work or suggest a course of follow up action pending receipt of the Commission’s report and recommendations.
While the issue of sub-minimum youth rates is being considered, the Government will continue to be guided by the recommendations of the Low Pay Commission, with regard to any changes to the National Minimum Wage.