asked the Minister for Labour if his attention has been drawn to the fact that where financial compensation is awarded under the Unfair Dismissals Act, 1977, social welfare payments payable to the worker unfairly dismissed are deducted from the compensation; that the Minister for Social Welfare has expressed disquiet about this situation; if he shares this disquiet; his views on whether the effect of this situation is for the State to subsidise employers in unfairly sacking workers and also making unfair dismissal a cheaper option for employers rather than redundancy because of this subsidy by the State; his views on whether, as compensation is the most common form of redress under the Act, this practice undermines the effectiveness of the Act; if he will take action to redress this situation; and if he will make a statement on the matter.
Written Answers. - Unfair Dismissals Compensation.
I am aware of the Employment Appeals Tribunal's practice of deducting social welfare payments from awards of compensation in cases of unfair dismissal. I understand that the reasoning behind this is the provision in the Act that the employee should be compensated in respect of any financial loss incurred by him which is attributable to the dismissal. Clearly, the financial loss of an unfairly dismissed employee is mitigated by any other income received — such as social welfare payments or, indeed, remuneration from alternative employment — and this is simply reflected in the amount of the compensation he is awarded.
I am aware also of the reservations — including those outlined by the Deputy — about this approach. Indeed, because of these, I arranged that the matter be dealt with in the recently published discussion document on the review of the Unfair Dismissals Act, 1977. I would refer the Deputy to paragraph 36 in page 22 of that document.
I am awaiting the views of the interested parties, particularly the FUE and ICTU, on the various options outlined in the document for change in this and other areas. When I have concluded my examination of these views I will consider what new measures, if any, I propose to take.