Industrial Relations (Amendment) (No.3) Bill 2011: Second Stage (Resumed)

To listen to employers' reactions to the Bill when it was published at the end of last year one would think it was a heroic step forward for workers. Organisations such as the Restaurants Association of Ireland expressed its outrage at the Government's decision to re-introduce Joint Labour Committee, JLC, wage setting systems, demanding that the Minister abolish the JLCs and allow employers to recruit without barriers. This point was echoed by the Irish Hotels Federation, claiming the Bill was an impediment to job creation, and the Irish Small and Medium Enterprises Association, ISME, said the issue of pay had not been well enough tackled.

Despite wailings from the rump end of employers' organisations the Bill does not restore previous JLC wage levels. At best there is a partial restoration of the protection that the agreements provided for. It is a bit rich of the Labour Party, in particular, to hide behind the trade unions in accepting this fudge or half-way house as a step forward. It is not a step forward at all.

Let us look at the deal in detail and at the nature of the legislation. The first point one must make about the legislation is that pay will be reduced under it. There are no ifs or buts about that. The setters of the rates must take into account a range of factors, which include the legitimate financial and commercial interests of the employers in the sector in question but also the general level of wages in comparable sectors including comparable sectors in other relevant jurisdictions; the current national minimum hourly rate of pay; and the appropriateness of fixing a higher statutory minimum rate of pay. When one considers all the little caveats and hypothetical arguments, one must ask what other jurisdictions are being talked about. Is the Minister talking about Britain or Northern Ireland, where conditions are not comparable and where the standard of living would be lower than what workers in this country would have to put up with? The vagueness allows employers here to set the rates quite low.

The key issue, which has already been highlighted and which is one of the key weaknesses of the restoration, is the fact that the Sunday rate is gone. The Minister has requested that the LRC devise a code of practice for Sunday working but it is not dependent on consensus between the unions and employers. At best, it is a sort of vague fudge. That the Government keeps saying the organisation of working time legislation gives cover in regard to Sunday work is not good enough because it is a different mechanism of protection and does not establish the necessity of having an extra payment for Sunday. It allows for time off instead or another solution.

That the legislation allows only two higher additional rates of pay is not good. It restricts the scale and manner in which workers can progress. A considerable problem is the fact that the legislation is allowing for sub-minimum rates of pay to be paid in accordance with national minimum wage legislation categories for under-18s in regard to first employment and training. It seems very silent on the sort of training in question. We have all come across very spurious, bogus training schemes that allow employers to escape paying what they are statutorily obliged to pay. Why has a proper, accredited training scheme not been factored in under the National Qualifications Authority of Ireland or other similar organisations? I presume that safeguard must be built into this legislation.

Another major flaw or weakness is in the inability-to-pay sections of the Bill. The legislation is making it possible for employers to plead inability to pay and seek an exemption for between three months and two years. Furthermore, it is stated the Labour Court shall not grant an exemption if the employer has been granted an exemption in respect of the same worker or workers under that subsection within the previous five years. Even the Minister's legislation is telling us that it is anticipated that employers or companies will use the inability-to-pay clause. The Bill allows an employer to plead inability to pay for four out of seven years based on the way it is formulated. It provides for the fact that if workers and the trade unions do not agree, the Labour Court will be able to impose binding arbitration without obtaining the consent of the parties. That is a dangerous clause to include.

It is regressive and regrettable that there is no provision in the legislation to allow workers to examine the books or accounts of employers who are pleading inability to pay. Workers and their representatives should be allowed to see the books where an employer is seeking to evade his obligations under the inability-to-pay clause.

The parts of the legislation that deal with trade union organisation and refer to trade unions being "substantially representative" are dangerous. The unions must prove themselves to be substantially representative. This sounds a little like the circumstances in the United States where union recognition has been whittled away. While I can understand why the Government would include such a clause, it is not as understandable as it might be given that the Labour Party is a partner in Government. The trade union movement, which has been bleating, whinging and gasping for this legislation, is in part shirking responsibility in that it is relying on organs of the State to do the job it was set up to do. If unions spent half as much time organising workers and doing the job they were set up to do as they do running after politicians, workers would achieve far greater protection than they would if they were to rely on legislation alone.

One of the points of misinformation issued by the Government on this subject is that it is claimed that workers currently covered by JLCs will not be affected by the changes in that they are currently covered by their current contracts of employment. That is not a sufficiently good answer. There are, as we know, many workers who, despite the previous JLCs and the existence of NERA, do not have individual contracts of employment. Many employers have questioned the constitutionality of JLCs because of the High Court ruling. If an existing contract refers to an ERO or JLC rate, there is no issue but the figures may not be specified. In that sense, the wages of those already covered by this agreement could be affected.

We have all seen employers using the circumstances that obtain - particularly where there are vulnerable workers, many of whom are of non-Irish origin - to state the law has changed and that the contracts must consequently be changed. Workers sign under duress and there are insufficient safeguards.

Skills, training and higher remuneration for workers need to be examined. The Minister's press release on the legislation referred to having two additional higher rates of pay based on length of service in the sector or enterprise concerned in addition to standards and skills recognised for the sector concerned. Skills are not mentioned at all in paragraph 42A(4)(b), which deals with the higher rates of pay. It provides for a “minimum hourly rate of remuneration and not more than 2 higher hourly rates of remuneration based on length of service in the sector or enterprise concerned, for all or any such workers”. A worker could have a certain period of service, say, ten or 15 years in a particular sector, perhaps in a restaurant, but his new employer could use the ambiguity in the legislation to state he did not have to recognise the employee’s greater skills. The employer could state the employee’s term of service pertains only to his current employment and that he does not, therefore, have to give the employee higher remuneration.

The key point, which is the same one made last week on the new legislation dealing with agency workers, is that although we can keep introducing legislation, we will be wasting our time unless the necessary supports are put in place to ensure enforcement and we will be creating an illusion that workers are being protected.

In its report in the middle of last year on non-compliance with the old JLC rates, the NERA revealed that the compliance rate in catering was only 26%, that the rate in retail was only 28% and that the rate in the hotel industry was 26%. This was under the old JLC-ERO legislation which we all said established a great system, yet only a small minority, a quarter, of employers were found to be in compliance. Therefore, legislation alone is not enough. If the Minister is serious about safeguards, both enforcement and adequately equipping organisations and individuals such as the LRC rights commissioners must be addressed urgently.

The most important matter in this Bill is that in making any amendments to the Industrial Relations Act 1946 in order to conform to the High Court judgment, these amendments should not only be within the parameters of the judgment but in unambiguous wording which is also compatible with the spirit and intent of the 1946 Act. Any amendments must be framed to ensure the approximately 200,000 workers covered by employment regulation orders, EROs, cannot have their entitlements detrimentally affected and do not lose out on any benefits they currently receive.

The JLCs have served this country well since their introduction and provide a very democratic representation between employers and the unions representing workers. It is well known this has been a tried and tested procedure whereby the JLCs make recommendations to the Labour Court, which then makes an employment regulation order. This process has been highly successful down the years and I would be apprehensive of any major overhaul of the existing Act, particularly as it has survived the test of time and has contributed enormously to industrial peace in many sectors of employment.

The JLCs have also introduced an element of civilisation into the wage structures and conditions of employment in the work system. Employers and employees in certain industries are bound in a highly disciplined fashion by the labour regulations. In the past, low paid workers had often not been represented by trade unions and the JLCs were introduced at that time to give them, in a civilised manner, a floor for wages and employment conditions. Therefore, the main thrust of the JLC concept in the 1946 Act will have to be retained in conforming to the High Court judgment. We must take cognisance of the success of the old system, although the reality is that adjustments have to be made to make it more responsive to the needs of the current economy.

The main emphasis of the legislation will have to be, as it has always been, the protection of vulnerable workers as well as being in the fair interests of the employers in order to ensure the business is viable and remains competitive so as to survive in these challenging economic times. Therefore, it is crucial to strike a fair balance in an equitable manner.

A number of matters arise. The Bill inserts a new section in the Act of 1946 that sets out the principles and policies the Labour Court must take into account when considering whether to register an agreement. The Labour Court will be required to have regard to whether the parties to the agreement are substantially representative of the workers and employers in the sector. In this context, the court shall have particular regard to the number of workers represented by the trade union party. However, given some 200,000 workers are not represented by a trade union, there is an anomaly in so far as the 2010 budget removed the income tax relief for trade union subscriptions. I call on the Minister for Finance to reintroduce that relief. We tend to forget that in private industry only a minority of the workforce is unionised, which leaves a majority of such workers with no professional representation. This incentive should be reintroduced to give them the chance to be properly represented.

Subsection (13) of section 33A provides that if a new worker replaces a worker to whom an exemption relates, the employer may pay the new worker the lower rate. The current protection of employees in regard to temporary agency work is very relevant in this regard. There is a need for protection and I hope that when the legislation for temporary agency work is introduced, it will cover aspects of this. I ask the Minister to take note of this point and to ensure that temporary workers replacing full-time workers would be entitled to all the increments, entitlements and pension rights they should have. This should be considered when drafting the Bill.

Another matter is the reduction of the number of existing JLCs from 13 to six, which is not an acceptable method of dealing with the matter. I ask that the 13 JLCs would be retained for a period of five years. The Bill provides that the Labour Court will, following the commencement of this Act and at regular five-year intervals thereafter, conduct a review of all establishment orders in respect of existing JLCs. I ask that we would retain the existing 13 JLCs for that five-year period.

The composition of the boards of the JLCs is another issue given new appointments to the boards are being considered. I ask that the existing members would be retained to give recognition to the work they have done as well as to their capabilities and the experience and knowledge they have gained, which will be vital in setting up the new JLC system.

Deputy Clare Daly referred to the section precluding JLCs from setting Sunday premium rates but allowing compensation for Sunday working to be assured under the Organisation of Working Time Act 1997. I support the call by Deputy Daly on this matter. We should have a complete reconsideration because there should be some input from the JLCs.

Overall, the main point is that we would have legislation that will be workable, practical and rational and which will follow the concept of the old JLCs, which were set up to protect vulnerable employees. Naturally, we want to ensure our business people will also flourish and continue to exist in the market and create new jobs. We will have to look at all aspects of the issue and strike a very fair balance.

I wish to share time with Deputies Paul Connaughton and Simon Harris.

Is that agreed? Agreed.

I welcome the opportunity to speak on the Bill. In publishing the Bill, the Minister, Deputy Bruton, has recognised the urgent need for a fully reformed and modernised joint labour committee structure. Reform is needed to ensure that the system is constitutionally robust and representative of Ireland's economic situation. This need was made even more evident in the recent High Court judgment which struck down the employment regulation orders as invalid. The decision meant that the EROs made under that system could no longer be enforced and cases against employers for breaches would have to be dropped completely. This would leave employees in a very serious predicament as basic rights could not be protected under the Constitution. Constitutionality is a fundamental issue that had to be addressed urgently.

Registered employment agreements are supposed to provide protection for local contractors as well as for employees whose wages and conditions are set by the agreements. Minimum rates of pay and other conditions of employment for workers in sectors such as hotels and catering are laid down in employment regulation orders made by the Labour Court. These orders are determined by the proposals of the relevant JLCs. Employers are bound to pay rates and provide conditions of employment not less favourable than those prescribed in employment regulation orders.

In dealing with what is undoubtedly a complex and multifaceted issue, important aspects that must be tackled by the Minister include overtime, premium Sunday payments, the number of JLCs and the general function of the system as a whole. The main problem with the previous system was that there was no principle of guidance for JLCs in making wage-setting decisions. This Bill will allow joint labour committees to set a basic adult rate of pay and two higher rates. However, in rate-setting decisions important factors such as unemployment rates and competitiveness must be taken into account. Sunday premium rates will no longer be set by JLCs but will be governed by a statutory code of practice, to be prepared by a labour relations committee. These rates will be recognised, mainly through options set out in the Organisation of Working Time Act. Provisions of time in lieu are not included in these options.

Reformation of the current system is based on two primary objectives. The first is to help businesses survive in what are turbulent times; the second is to protect existing jobs and help create new ones. The commitment to reform the system was outlined in the programme for Government. The economic situation had a significant impact on the labour market, particularly in areas such as retail, hospitality and construction. The reality for employers is that labour costs account for a large part of costs. In the current environment it is vital to ensure that structures are flexible enough to adapt to changing conditions and reflect economic realities.

According to the latest statistics available from the Central Statistics Office there are approximately 33,000 people in the midlands on the live register. This Bill will open an opportunity for employers to create more positions within their companies, which will go some way towards reducing live register numbers. This Bill is an example of a forward-looking reform that is part of an overall commitment to reduce the number of unemployed and get as many people as possible off the dole queues and back to work.

It is the intention of this Government that through this Bill barriers to job creation should be removed in so far as possible while at the same time protecting workers' basic rights. A balance has to be found between improving employer competitiveness and protecting the rights of thousands of low paid workers. It is important to point out that existing workers will not be affected by the changes as they are covered by their current contracts of employment.

I welcome the publication of this Bill and commend the Minister, Deputy Richard Bruton, in all his works thus far.

I thank the Ceann Comhairle for giving me the opportunity to speak on this very important Bill.

Maintaining competitiveness in what are volatile national and international markets is a key element of this Government's economic strategy. To that end, I welcome the provisions of the Bill as it seeks to overhaul wage setting mechanisms radically in response to the current deep recession the country is experiencing. A wage-setting mechanism had evolved in recent decades that reflected an increasing prosperity and sought to ensure that the economic fruits of the Celtic tiger era were shared among workers. Now, in a drastically different economic climate, it is timely and just that these wage-setting mechanisms should be changed to reflect the new challenges faced by industries across all sectors.

This Bill seeks to implement a robust system of protection for workers following a High Court ruling in summer 2011 in which employment regulation orders, EROs, were found by Mr. Justice Feeney to be unconstitutional as they lacked the necessary Oireachtas oversight. This case was one of a number of important cases brought in recent years in respect of wage-setting mechanisms. There are also a number of challenges in regard to electrical and construction registered employment agreements, REAs, pending in the High Court.

Following the judgment of Mr. Justice Feeney, an independent review report, the Duffy-Walsh report, was brought forward, which featured a range of recommendations in terms of wage reform. The introduction of such legislation to reform the JLC system had been part of the commitment in the programme for Government and this commitment was underlined in the EU-IMF memorandum of understanding, by which the Government undertook to introduce legislation to modernise registered employment agreements and employment regulation orders, with a view to reducing the negative impact on both job creation and competitiveness.

The principal measures outlined in the action plan included a proposal that JLCs would no longer set Sunday premium rates or any other conditions of employment covered by universal standards provided for in existing legislation. However, it is important to point out that the special position of Sunday working will still be upheld under section 14 of the Organisation of Working Time Act 1997, and a special code of practice to be devised under that Act.

Employers will be able to seek temporary exemptions from EROs and REAs in cases of financial difficulties. I also welcome the fact that in setting rates, JLCs will have to take into account factors such as unemployment rates, competitiveness and wage trends here and in our major trading partners. This reference to those trading partners is a key inclusion, given that huge disparities in wage rages in certain sectors are giving industries outside this jurisdiction an unfair advantage when it comes to tendering for important contracts. I note that the Minister has signalled his intention to introduce an amendment to clarify this matter. I also welcome the reduction in record keeping requirements for employers in the sectors covered by the JLCs.

Overall, the provisions of this Bill aim to maintain the country's competitiveness in key areas and underpin employment levels in these sectors. As with any such new regime, it is key that proper review structures are put in place and adhered to. The new legislation provides for a review mechanism to ensure that reviews of the JLCs will be undertaken by the Labour Court, at a minimum at five year intervals. These comprehensive reviews will examine the scope of all remaining JLCs and changes to the relevant orders if necessary.

The derogation offered by the current legislation is a key feature of the current Bill, providing a much-needed lifeline to many businesses currently struggling to pay wage bills. The new derogation will pertain where it can be proved to the satisfaction of the Labour Court that there is a genuine inability to pay. It provides that the maximum period to which the derogation can apply is two years and it must be for a minimum of three months. An employer will not be entitled to seek an exemption if he or she has already received an exemption in respect of the same worker in the previous five years.

In the absence of such an agreement being agreed with the majority of the workforce, the Labour Court must be satisfied that the employer has informed the workers of the financial difficulties and has attempted to reach agreement with the workers concerned; that the employer is unable to maintain the terms of the ERO; and that requiring the employer to comply with the ERO would result in a substantial risk that a significant number of workers would be made redundant or laid off, or that the sustainability of the business would be affected.

A safeguard in the Bill is provided in that the Minister may refuse to make any order that he or she considers inappropriate, and if the Minister is not satisfied that the procedures have not been complied with, he or she may refuse to make an order and notify the Labour Court of his or her decision. Another welcome provision in the Bill is that civil penalties will be used rather than the current reliance on criminal sanctions. In recent court decisions the use of criminal law as a sanction for failure to comply with employment registered orders has already been questionable. One hopes this measure represents a move away from incarceration as a remedy to all social ills. The individual industries involved have profit making as a primary aim and therefore civil penalties are wholly appropriate.

This Bill contains a proposal to remove the Sunday premium from the remit of the JLCs and its replacement with a code of practice on Sunday working, to be devised by the Labour Relations Commission. The LRC will seek submissions from employer interests and trade union representatives in preparing the proposed code of practice. The consultation process will result in a code of practice that will be given effect by a ministerial order. This code will provide guidance to all employers and their employees in sectors covered by EROs on the compensatory arrangements that must apply, including the additional amounts deemed reasonable for Sunday working and the procedure to apply in the event of a dispute concerning the various entitlements.

This consultation process should be greatly widened to allow individuals and various interest groups to take part. For example, an increase in the number of people required to work on Sunday could have a huge impact on sporting organisations, youth groups and also many community events such as village fairs and fetes, agricultural shows, county ploughing championships and other community events.

Religious organisations should also be offered an opportunity to have a say on this Sunday working code of practice. Such a consultation process would open the debate on Sunday working practices to a wider public and determine a course of action that takes into account both the undoubted market for shopping on Sundays with the effect that even wider Sunday opening could have on family life across the country. This consultation process must not be limited to only employer interests and trade union representatives but open to the wider public.

Competitiveness across all sectors and industries will be a key factor in putting the economy back on a sound footing. The economic conditions that pertained in the boom times are but a distant memory for many companies and wage-setting mechanisms have to be changed to reflect that. However, I caution that much greater consultation than is envisaged is needed in the treatment of Sunday working practices in the economy for the future.

I welcome the publication and introduction of this important legislation. It continues the Government's agenda of both helping job retention and establishing the foundations for economic recovery while supporting the most vulnerable workers in our society. It follows on from the restoration of the minimum wage, clearly aimed at assisting lower paid workers, and the jobs initiative, aimed at incentivising small businesses and schemes.

It is welcome to see issues of working conditions discussed in this Chamber once more. For too long, particularly during the boom years, decisions about pay and conditions were taken behind closed doors and never scrutinised or discussed by we, the people's representatives. It is important more discussions on the labour market such as this take place in the House. While I have no difficulty with the Government engaging with vested interests, be they trade unions or business interests, this is the primary forum for such discussions.

An overhaul of the statutory wage-setting mechanisms has long been overdue. The Government was also left with no choice in light of a recent High Court ruling on them. This Bill sets out to fulfil an important commitment in the programme for Government to overhaul inherited wage-setting mechanisms which were farcical, impractical and very much outdated. A balance is to be found in reforming the joint labour committee, JLC, system to ensure a robust system of protection for workers is reinstated but one which gives flexibility to allow businesses to respond to changing economic circumstances.

As we seek to create jobs and to support small and medium-sized businesses, we must also protect the jobs we already have. Job retention is a key consideration for every business and employee. We are faced with the challenge of creating legislation which both protects the position of the worker and ensures employers and employees alike are not trapped in bureaucratic systems which are not suitably responsive to their needs in these difficult economic times. This legislation strikes this balance.

What we are seeking is a move to reinstate the robust protection that workers deserve but in a manner which reflects the operation of a modern economy. When the Minister is criticised by both sides of the debate - business representatives on the one hand, trade union officials on the other hand - for not going far enough, it means he must be doing something right. The Government, the Minister for Jobs, Enterprise and Innovation, Deputy Bruton, and the Minister of State, Deputy Perry, are not beholden to either side of that vested interest struggle. The political temptation is always to flock too far to one side. This Bill has resisted that temptation and taken the responsible course, standing by the economy while protecting vulnerable workers, a difficult task in itself.

Several of the Bill's specific measures should be widely welcomed. The first is the introduction of clear principles and policies that JLCs must refer to in setting minimum pay and conditions. This common sense approach will require JLCs to make specific reference to the best interest of employers and workers and the need for competitiveness and wages in comparable sectors. While JLCs may have taken these factors into account in setting wages in the past, it is important this arrangement is formalised and reflected in legislation.

Section 13 provides for a mechanism to allow employers a temporary derogation from the scope of employment regulation orders, EROs, on the grounds of financial difficulty. While the Government is striving to create the right conditions to create additional jobs, it must be recognised many businesses are doing everything they possibly can to retain the staff they already have. It is important any actions this House takes sets out to support businesses in that task.

The idea business is out to reduce the workforce and its labour costs is not reflected in many of the small and medium-sized businesses we public representatives encounter. Since my election, I have had the pleasure of meeting with many local business owners across County Wicklow. In our towns and villages, there is a sense of community and these businesses want to retain and create employment.

Given the current economic circumstances, the mechanism for this derogation is important which will restore confidence to both employers and their employees who look at it rationally. I also welcome the safeguard the Minister included in this provision to prevent worker exploitation by unscrupulous employers. It is clear this will be a one-off exemption of a set maximum duration.

I agree with Deputy Connaughton on the need for consultation and recognition of the different factors in the removal of the traditional Sunday premium from the scope of EROs. However, we must also acknowledge the economy is not nine to five, Monday to Friday. Many sectors involved in EROs may see their busiest days on weekends. Restoring that flexibility to Sunday working arrangements is not just about benefiting employers but about creating conditions in which workers are able to work hours that suit their lifestyles and skills sets. I understand the Minister proposes to complement the removal of the Sunday premium by having the Labour Relations Commission devise a code of practice on Sunday working. I welcome this consultation process, which should be wide as possible.

Just as we are seeing new and additional reforms of the working practices in the private sector, there is scope for further reform in the public sector. Many private sector workers listening to this debate are only too aware of the difficult circumstances facing many businesses. Many of them will also be galled by the anomaly of salary increments being paid to individuals in the public sector earning above €70,000. This is not an attack on the public sector. Pitting of private against public is ridiculous and a legacy of the previous Government. It is helpful to no one. We need to protect all those on modest incomes and vulnerable workers, be they public or private. As many families and businesses struggle in these challenging economic times, we must work to protect the wages and conditions of all low-paid workers while ensuring flexibility and responsiveness in all sectors in which this has not always been the case.

I welcome this legislation and commend it to the House.

I wish to share time with Deputy Brendan Smith.

I have much sympathy for the Minister for Jobs, Enterprise and Innovation, Deputy Bruton, in tackling this legislation. Much of what is contained in the Bill is fair and reflective of how the economy, and small businesses in particular, stands. It contains the wish across the entire House to provide the best possible protection for employees governed by JLCs. I acknowledge the departmental officials in the Chamber who have done their walk to Calvary on this legislation and have probably been nailed to a few crosses along the way. While the Bill may not be perfect, I hope it, combined with reforms to industrial relations institutions such as the Labour Court and the Employment Appeals Tribunal, will provide a far more efficient, robust yet flexible system. The current system is not flexible or responsive in the context of our current economic position and the erosion of workers' rights. Over the past number of weeks, companies have gone out of business overnight and left their workers without basic statutory entitlements, something that rarely happened in the past. This generally involved multinational companies with huge legal advice behind them. We must have a system that is robust and can stand up to that. A little tweaking of the legislation would be welcome.

I welcome the fact that an inability to pay mechanism has finally been devised. Companies have been forced to make difficult decisions over the past number of years and they have had no flexibility under REAs and JLCs. In a number of companies, the workforce agreed with the management without having guns held to their heads about the need for a derogation but management was in a position to implement it. Some of them closed or redundancies were made because every company was tied into an REA. Jobs were lost and Members protested about that. I will bring them to businesses where jobs were lost because of the lack of a derogation mechanism and show them the tumbleweed. I tried to introduce it as Minister of State but I was stymied by those who say they were acting in the interest of job creation. The introduction of the inability to pay provision is being diluted by the manner in which the Minister has reduced the redundancy rebate. That will come back to haunt the Government because many companies will be forced to close rather than lay people off because of the massive overnight reduction in the rebate. The strength of the provision will be diminished by that.

Last week, I contributed to the debate on the temporary agency directive. I have not made it a secret since I entered the House that I tend to adopt a pro-business view. We look to business people to create jobs. Governments do not create jobs; they create the conditions for jobs. When one stands up on behalf of business, all sorts of accusations are thrown. I read some of the contributions following my own last week by Members, some of whom have not even worked a day in their life, never mind created a job, who had a go because I stand up for business. I make no apology for that because not every business in the State behaves like La Senza, GAMA or Vita Cortex. Approximately 95% of business people wake up on Monday morning wondering how the hell they will open the door that day and how will they pay the wages or the energy bills. We need to get a debate going to stand up for them in order that in the House we understand the pressure they are under when they wake up Monday morning wondering how they will pay the bills. We have all met business people who are not taking a salary from their business and who are living off savings or other salaries coming into their house because they are paying the bills in an attempt to keep their businesses open while hoping for the turnaround. When legislation is framed that impacts on them, we need to think more about the pressures they are under and I, therefore, welcome some of the flexibilities in this Bill.

The workload of the Labour Court, the Employment Appeals Tribunal and other institutions will increase under the legislation. I acknowledge that the Minister is bringing forward a range of reforms but current tribunal waiting times are unacceptable. It is 74 weeks in Dublin, up from 58 weeks in 2010, and 76 outside Dublin. If cases are urgent and need to be heard quickly, a shorter turnaround than 18 months is needed and the system must be robust in order that rogue employers who let the business community down know they can be tackled urgently.

I refer to NERA. The previous Dáil taught me a lesson about the making of legislation in the House. When the authority came under my watch, there were queues of Members from every side of the House having a go with NERA being described as the biggest anti-Christ in the State. I checked with many of them who had contributed to the debate when the legislation was going through and the majority supported the authority's creation and they gave it all its powers. When NERA began to use the powers it had been given by the House, Members started kicking up. It was an eye-opener. However, the authority needs to engage in an information campaign about the legislation. When it is passed, NERA needs to hit the road and not assume that every employer will know what are their obligations. Instead of carrying out inspections, it needs to conduct information campaigns and fill employers in on their obligations similar to the Revenue Commissioners. I accept we picked on the Revenue last week but it is a good organisation in the context of providing information on people's rights and obligations.

I agree with Deputy Connaughton that we should take this opportunity for a debate on Sunday working. Let us take it out of the industrial relations-business context. There should be a day in the week when workers get a break from the rat race but for many of them, it cannot be Sunday. Some people have to work in order that others can have a break and Sunday is, therefore, not a day of rest for many anymore. It might be Tuesday or Wednesday and a clash will result if old style ways of doing things are imposed on modern ways of living. Provision should be made for people to take days off but there should not be an insistence on using only one day. This issue should also be considered in the context of people who work six days a week.

The legislation should have been considered in tandem with the temporary agency directive and the reform of various institutions that is coming down the track. At the end of this process, we need a system that is robust and can stand up to legal challenge with the Oireachtas being able to say it did its job properly by introducing strong legislation. We need a flexible system because business and employment patterns are changing. What worked in the 1930s and 1940s does not work anymore and what worked in 2011 probably will not work next year, given the pace of change. Employment cannot always be behind the curve. There is potential in the reform of the JLCs to address this. Agreements must be monitored and changed to reflect different circumstances. I welcome the introduction of time limits to impose change. What happened previously was ridiculous. JLCs would begin a discussion that would go on for years and, in the meantime, workers would lose their jobs. That is a legacy of the old system.

There is a great deal of concern about reducing the number of JLCs. I am not convinced of the merits of retaining a set number of committees. It would be much better to debate the sectors in which such committees should be established. JLCs are needed in the services, retail and a range of other sectors but rather than agreeing a precise number, the sectors in which they are needed should be examined such as those in which labour is transient and in which there is the greatest erosion of labour law. JLCs should be focused on those sectors rather than on ensuring a particular number of committees is set up. Laundries were relevant in the 1940s but they are not today, yet there is still a JLC in place for them.

I have a great deal of sympathy for the Minister. I tried to pursue this agenda previously. I am lucky that I do not have a choir of Labour Party backbenchers in the House having a go at me with their choirmasters in SIPTU leading the charge. We have something we can work on but, by the end of this year, this legislation needs to be enacted as well as the legislation on the reform of various institutions and the temporary agency directive. The Government has taken a range of decisions since November that are anti-business, although that was probably not intentional, such as the VAT increase, the reduction in the redundancy rebate and the reduction in the capital programme. As well as introducing pro-business legislation, the Government needs to get back to implementing pro-business policies. Then maybe we can all start achieving our shared aim of job creation.

I am glad to have the opportunity to make a short contribution on this important legislation.

My colleague, Deputy Calleary, referred to the ongoing dispute in Cork about which Deputies Buttimer and Martin have been exercised for the past number of weeks. On Thursday last, some of the workers from Vita Cortex from Cork were here in Kildare Street along with employees of the Lagan Brick company from Kingscourt in my constituency. I put this issue forward as a Topical Issue debate and was glad that the Minister, Deputy Bruton, came to the House and responded in person. I appeal to the Minister of State, Deputy Perry, to ensure that a further message goes to the Labour Relations Commission that we want that dispute resolved as soon as possible. The Minister of State can, through the appropriate channels, outline our concern and that of the local community about that ongoing dispute. A proper industrial relations architecture is necessary in any modern economy. We must ensure that our workers are adequately protected.

In the case of Lagan Brick, the company, which was established in the 1930s, had approximately 30 employees when one evening in the middle of December last, two of the shop stewards were called to a meeting to be told that the employment would cease forthwith. That was not in keeping with the protection of employees Act and, naturally, the issue has been the source of protest since the middle of December last. The issue is before the Labour Relations Commission and a conciliation process has been underway for two weeks. From my dialogue with employees and with SIPTU, I understand that some progress is being made. I appeal to the Minister of State, Deputy Perry, and his Department to ensure that a message goes clearly back to the Labour Relations Commission that we want the issue dealt with and the employees to get all their due rights. Other public representatives - Deputy Ó Caoláin and Senators Byrne and Wilson - have also been speaking publicly on this issue as it affects Cavan, Monaghan and Meath because persons from each of those counties have been employed in Lagan Brick over the years. Our ultimate aim is to seek the production facility back in operation.

There has been a tradition of brick manufacturing in Kingscourt for over 100 years. Some decades ago, there were two brickyards in Kingscourt. We want to see the one surviving brickyard back in production.

I was disappointed that a major company would communicate with its employees the cessation of their employment in such a way, with a few hours notice. It was not adequate. I would appeal to the company and the Labour Relations Commission to ensure that all the workers get their due rights. Staff have been there for many years. One employee I know has worked in the company for over 40 years and many other workers are long-standing employees as well.

I visited the company when the employment subsidy scheme was introduced a number of years ago by the former Tánaiste and Minister for Enterprise, Trade and Employment, Ms Mary Coughlan. With the downturn in economic activity, particularly in the construction sector, demand for the Lagan Brick product had understandably reduced. At that time, the company brought in greater efficiencies. There was a reduction in pay. My understanding is that 25 workers today are doing what 34 workers did previously. That showed the goodwill, faith and determination of the workforce to ensure that they made their plant more effective, more efficient and more productive. I want to see it back in operation as soon as possible.

One person's reform can be another person's pay cut. As the parties in Government have shown us over the past nine months, the use of language and the awarding of statements is pivotal to this debate. Everyone speaks of reforming the JLC system but the problems start when it comes to framing the reform.

Deputy Calleary gave a good outline of the difficulties in achieving the proper balance to protect workers' rights and to ensure that we are also encouraging the creation and maintenance of employment. Fortunately for those affected, the previous Government put the right framework in place by appointing Duffy Walsh at the beginning of last year to examine ways to reform the operation. It reported in May last. The fact that it has taken a further eight months for the Government to arrive at some consensus and get us to today's debate has only succeeded in causing further worry and anxiety for so many employees.

When Duffy Walsh reported some, in particular Labour Deputies, were frustrated in their comments that the Minister, Deputy Bruton's, notion of reform differed considerably from their own and they were good at getting that message out. The spinning and posturing, coming not only from around the Minister but from others, both some in Fine Gael and other commentators in the public media, alarmed everyone concerned with protecting the lowest paid. The attitude of scrapping the JLCs does not assist anybody. It does not assist the overall economy, employees or the overwhelming majority of employers, who are conscientious and hard-working people and who want to put in place the best conditions and wages and remuneration for their employees.

The programme for Government negotiated and agreed between Fine Gael and Labour refers to reforming the JLC structures but leaves itself open on wider issues, stating, "Reform options will examine the rate of pay for atypical hours". Perhaps this half-hearted commitment goes part of the way to explaining the unnecessary and unforgivable delay in getting this Bill before the Oireachtas. This is a matter that should have been resolved before we returned after the summer recess. It is has drifted unnecessarily. The Fianna Fáil Party was anxious to see it dealt with and it is regrettable that the obvious infighting at Government and Cabinet level, and maybe between the parliamentary parties, delayed the process. Thankfully, what was being touted some months ago has been mitigated.

The Deputy has one minute left.

Of course, the Labour Party is the author of its own embarrassment in this. Its posturing in many instances did not prove worthwhile.

While we welcome the fact that the Minister has been compelled to shift his ground and come closer to the recommendations of the Duffy Walsh report, last night the Fianna Fáil Party spokesperson on enterprise and employment, Deputy O'Dea, outlined some of our remaining concerns with this legislation. He outlined clearly issues that need to be addressed on Committee Stage and we hope that the Minister, Deputy Bruton, and the Minister of State, Deputy Perry, would see fit to address them in a progressive and positive manner.

I will be sharing time with Deputy Buttimer, if that is agreeable.

The Industrial Relations (No. 3) Bill 2011 has been introduced to fully reform and modernise the JLC system. By achieving this, it will fully reflect the challenges of a modem economy and also ensure the system is constitutionally robust. These are notable and commendable aspirations.

The Bill, when enacted, will implement the programme of reform to the statutory wage setting mechanisms agreed by Government in July 2011. It will radically overhaul the system so as to make it fairer and more responsive to changing economic circumstances and labour market conditions. It is this ability to respond in an effective manner to such conditions that gives the Bill great credibility.

It should not be forgotten that the introduction of the legislation to reform the JLC-REA system is a commitment in the programme for Government. In addition, there was a commitment under the most recent EU-IMF memorandum of understanding to legislation before the Dáil to modernise registered employment agreements and employment regulation orders with a view to reducing the possible negative impact on job creation and competitiveness of existing arrangements. The fact that these commitments are being met with this Bill is further evidence of this Government's fervent desire to live up to all its commitments.

In July 2011 the Government agreed a package of radical reform of the joint labour committee and REA wage settling mechanisms. The reform proposals included the recommendations in the Duffy-Walsh report. In addition the Minister has proposed several non-legislative flanking measures, which include the following reforms: taking steps to reduce the number of JLCs currently in place from 13 to six; standardising benefits in the nature of pay, including overtime and the conditions under which it becomes payable across sectors covered by JLCs; and preparing a new statutory code of practice on Sunday working to provide guidance to employers, employees and their representatives in sectors covered by the EROs.

The reforms in the statutory wage setting machinery operating at sector level, in conjunction with putting the JLC and REA systems on a more secure legal and constitutional footing, represent a significant commitment by this Government to protect the lowest paid and most vulnerable workers. These workers by necessity spend a higher proportion of their income on consumption and, consequently, cutting their wages will significantly reduce spending in the economy at a time when the savings rate is already high and domestic demand has collapsed. Any amendment to wage-setting mechanisms should ensure that the incomes of vulnerable low earners are fully protected and that demand in the economy is not further impaired. This is what this Bill achieves.

In taking account of the Duffy Walsh report, the Bill is a solid start in making the system fairer and more responsive to changing economic circumstances and labour market conditions. The overriding objective is to create a framework within which greater efficiencies and necessary adjustments in payroll costs can be achieved in the affected sectors. That has to be welcomed by all stake holders. This Bill has correctly acknowledged the recommendations of the Duffy Walsh report and has gone some way towards implementing them. The report called for a radical overhaul of the system and that is what this legislation does. I have no hesitation in commending the Bill to the house.

Deputy Smith's contribution made me smile because on 7 August 2009, the then Minister of State at the Department of Enterprise, Trade and Employment, Deputy Calleary, announced publication of an Industrial Relations (Amendment) Bill and on 9 February 2011, the then Minister for Tourism, Culture and Sport, Mary Hanafin, introduced an independent review. It is incorrect and unfair to claim this Government has been tardy.

It is important that we reflect on where we stand as a society and economy. We have to think differently and flexibly while at the same time striking a balance between protecting workers and supporting employers in creating jobs in, for example, the hotel and tourism sector. These objectives can be mutually compatible. I pay tribute to the Minister, Deputy Bruton, the Minister of State, Deputy Perry, and their officials in bringing to our present position.

What does it mean to be an employee in the Irish workforce of today? The jobs that will be affected by this Bill are in low paid and competitive sectors which require a degree of flexibility. I know several employers in the hotel and tourism sector who are finding it difficult to survive in the current market.

Deputy Harris spoke about the Croke Park agreement. It is time we had an honest debate on that agreement in terms of what it has delivered and where we go next. We should recognise the contribution made by the workers, however, because it is farcical that people on higher pay in the public service are not being questioned at a time when those who work on the front line are being pummelled. There are no more sacred cows when it comes to the public service. I speak as a proud public servant who worked in a classroom and was a school teacher by profession for more than 20 years. We must be flexible and modern but we cannot trample on the worker.

Job creation requires entrepreneurs to invest but it also needs a committed and people-centred workforce. Irish society can offer a very good workforce. It is important that we properly value jobs and appropriately reward work. This is why the Government restored the minimum wage, changed employers' PRSI rates and created incentives for employment. Work is the key to restoring our country's future growth and prosperity. We must never allow a situation to develop whereby it is preferable to be on welfare than to be in a job.

I commend the Minister of State, Deputy Perry, on his work with small and medium enterprises to create sustainable employment. He must be allowed to continue these efforts to eliminate barriers to employment and job retention. This is why the programme for Government highlights the need for reform. In his opening contribution on the Bill, the Minister, Deputy Bruton, stated: "It is necessary to make our economy more flexible, more competitive and more productive." This is not a question of ideology; it is about retaining jobs, rewarding employers in the tourism and hospitality sector and guaranteeing workers will earn a fair and decent wage.

Deputy Smith referred to the case of Vita Cortex. I welcome that we are in a process of engagement with the Labour Relations Commission, which met yesterday and will meet again on Friday. This is an issue of workers' rights. These people are not militant. They are not on the public highways trying to hijack or wrong anybody. They are merely seeking their entitlements. Imagine working 40 years in a company and being told at the 11th hour that the employer cannot pay redundancy. A number of young people are in the Gallery on a school tour. I hope they will not grow up in an Ireland where this is allowed to happen.

An employer has a responsibility and we need to consider reform of redundancy legislation. There must be transparency regarding what employers are entitled to offer and what they are statutorily required to provide. We must not allow company structures to be interweaved to facilitate profits, which is fine on one level, if they do not allow requirements to be met. That cannot be allowed to continue.

The Minister speaks about flexibility in the system, and I have no problem with that, provided a balance is struck between employer and employee. We cannot allow anybody to tell us that an inability to pay is a good enough reason to close down a company, particularly in the hospitality and tourism sector, which the Government has used as a benchmark for job creation, with our tourism figures showing that it has been successful. The Vita Cortex and La Senza workers have demonstrated that there is an imbalance, an anomaly, that must be examined. I am heartened by the fact that there are a group of people in Cork - like many of us here, ordinary, decent people with no airs and graces - who are seeking what is their right and entitlement, and they should be supported and encouraged. Equally, however, we must encourage employers not to go down this road.

Jobs, jobs, jobs is what we are hearing every single day. This is what is important. The job of all of us in this House, particularly the Opposition Members, is to create confidence, with the Government, in the economy. If we can get people to spend and to have a positive outlook, we can lift the morale of the country. We can lift the retail sector by creating consumer confidence. Deputy Colreavy said that Governments do not create jobs, and he is right. They do not. Jobs are created by a combination of factors.

Our banking system is not working in the way it should be for small and medium-sized enterprises. Credit is the lifeblood of business. It is what our companies and SMEs require. This morning I attended a very good briefing by the Central Statistics Office for Members and staff of the Oireachtas. I compliment the Houses of the Oireachtas on the presentation. One of the things I was struck by was the number of small and medium-sized enterprises in this country. It is extraordinary that such a massive number of people are employed in such businesses. There are more than 200,000 SMEs, as the Minister of State, Deputy Perry, knows well. The majority of them are employing small numbers of people. What struck me was that we went from having the second highest employment level in the European Union to having the sixth lowest in the space of two years. As a small, open, global economy, we do need foreign direct investment, but we also need inward investment from home. We need people who have the confidence to go in and invest.

Our county and city councils have a major role to play in the creation of employment. I made this comment last Friday in the context of the Local Authority Public Administration Bill, which we were debating at that time, and I will say it again today. The planners have a great role to assist in the economic development of our country by allowing people - in the main, entrepreneurs - to create business. They must show initiative, they must interact and they must allow development to take place where jobs could be created.

Equally, the issue of rates and energy costs must be tackled. I am very disappointed that we cannot go after upward-only rent reviews. I will go back to my own city of Cork, where many business are paying rents that are crazy in this modern age. I met a business person the other day who was paying almost €3,000 a week in rent for a holding that is nearly the size of my front room at home. We can no longer sustain that. I heard the Minister for Justice, Deputy Shatter, talk about the legal opinion he was given. However, there must be a realisation that rates need to be brought down. Cop-on must be shown. This is about creating five or ten jobs in small coffee shops or retail outlets.

Equally, our banks must work with people, and in the main they are not doing so. I want this to be highlighted. We must allow credit to flow. Businesses need a certain level of overdraft in order to survive, flourish, create business and assist the local economy. Maybe it is the case that we have too many retail outlets, and our hospitality sector is over-expanded, but I want to avoid a situation in which one could land a jumbo jet on Patrick Street in Cork. I want to see people coming in to shop and engage in recreation in the city of Cork, where I am from. That requires a willingness by employers to be flexible and it also requires flexibility in pay rates and the setting of labour payments. In addition, I hope the enforcement of penalties against employers that transgress the legislative provisions will be considered.

This is an important Bill. I do not agree with the remarks made by Deputy Smith about the Government. A High Court ruling was given and departmental officials sat down and examined it. I appreciate that this is a complex Bill and that it does not keep everybody happy. Indeed, if one looks through the debate pack we were given by the Library and Research Service, one will see that IBEC and the hotel and restaurant federations are up in arms about it. It is important, however, that we think anew. The Bill - particularly section 11, which deals with principles and policies - is very fair-minded. There is a mechanism for further interaction in which employee and employer are in communication and negotiation.

We must get it right when it comes to competitiveness, and we must create employment. We must never allow a welfare system to become the norm at the expense of job creation, and we must consider how we can create jobs and boost domestic confidence in the economy. The Government has made a good start in this regard. We have not got everything right, but we have been fair and balanced and we have put employment and jobs at the core of what we do as a Government. Employers, employees and the Government must work together.

I welcome the opportunity to speak on this important Bill. First, I extend greetings and solidarity to the workers in Vita Cortex and La Senza and all of the other employees who have had to fight tooth and nail, after years of dedicated labour, just for their redundancy entitlements. I also sympathise with the families and friends of the trawlermen on theTit’ Bonhomme, which sank off the coast of Cork last Sunday morning. They are in our thoughts today.

For most people, and for all of those covered by this Bill, the purpose of work is to provide for one's self and one's loved ones. It is about earning at least enough to have a reasonable existence, with the ability to pay for clothes, food, heat, accommodation, transport and other essentials, hopefully with something left over at the weekend for the odd luxury. An important part of any real debate on the effect of legislation that affects the pay of low-paid workers is an appreciation, understanding and acknowledgement of the fundamental importance of this employment framework to the quality of life of those under its protection.

One wonders how the Minister, his special advisers or his departmental officials, who have for many years earned many multiples of what is earned by people covered by JLCs, can relate to the lives of those for whom they are legislating. However, that raises another question. For whom are we legislating here? Is it the workers who have been caught in a vacuum because of the recent judgment, or has this been, as many might agree, an opportunity to safeguard further and enshrine the role of the employer?

On publishing the Bill, the Minister talked about trying to "strike a balance between protecting vulnerable workers and providing reforms that would make systems more competitive and more flexible to allow for the creation of jobs in these sectors". This is despite the fact that his Government's report on the subject, the Duffy Walsh report, stated that "lowering the basic JLC rates to the level of the minimum wage rate is unlikely to have a substantial effect on employment". My colleague, Deputy Peadar Tóibín, outlined Sinn Féin's position on the Bill yesterday. Unless there are necessary changes, in particular on the issue of the Sunday premium but also in terms of the balance between the rights of the employee versus the rights of the employer, we will be unable to accept the Bill in its current form.

It is impossible to ignore the fact that all of this movement on the rights of low paid workers - I acknowledge that the High Court judgment forced the issue and commend the Minister's prompt action to address it - is happening at a time when high paid workers, including Ministers and ministerial staff and others in the public and private sector, remain relatively unaffected. The word "relatively" and the relative impact of cuts are very important; they are fundamental to the ideological debate that underpins the Government's thinking and its approach to the economy. So it is that the Sunday premium can be scrapped while, at the same time, it is fine to proceed with the payment of many billions of euro to unguaranteed unsecured bondholders, private speculators and gamblers. They, like the Government's idea to sell off billions of euro worth of valuable State assets, are sacrosanct.

This does not add up for the workers who will be affected by this Bill. How, on one hand, can one target their Sunday payment and, on the other, leave those who took this country to the brink of ruin untouched? It is simply not fair or right. Weekend work is the only work many workers have and all of them factor the Sunday premium into the household budget to ensure they are in a position to provide for themselves and their families. The relative difference between taking that Sunday premium out of their pockets and taking it out of the pockets of the well-off is simply enormous.

Almost a year ago people voted for leadership and change, and for a move away from cliques and vested interests. It appears the old ways of politics were contagious, and this Government is finding it hard to find a cure. Go raibh maith agat.

I am sharing time with Deputy Gerald Nash.

Reforming the JLCs was a commitment in the programme for Government and I am glad we are responding to that commitment today. We live in an uncertain economic climate and we must respond to it and ensure we have an economy that is not only responsive to job creation but also protects the rights of workers. Among other provisions, the Bill allows the JLC to set the basic rate and the two higher rates of pay. In setting those rates the JLCs will have to take into account factors such as the unemployment rate and competitiveness, two key factors that impinge on our ability to create and sustain employment, as well as the wage trends in comparable sectors both here and in other relevant jurisdictions.

The Bill provides for companies to derogate from the EROs and REAs in cases of financial difficulty once specific criteria are met. It is true that the Sunday premium rate will no longer be set by JLCs. Although Sunday is a day of rest, in an increasingly secular society this is something that had to happen so we could maintain our competitiveness. Reforming the JLC and registered employment agreements was necessary and I welcome the opportunity to speak on this in the context of the Bill. The legislation contains protections for current JLC workers. This was recommended in the Duffy Walsh report and is most welcome. The Bill also provides for Sunday to be treated as a special day even though we are moving away from the traditional perception of it as a day of rest. It should be recognised and rewarded.

Another welcome aspect of the legislation is that there is flexibility to deal with situations where employers are unable to pay. This was lacking previously. Under the Bill, companies in financial trouble have scope to derogate from the terms of the EROs and REAs. However, the protections afforded to workers are very robust, which is welcome. It is encouraging that the Labour Court will be closely involved in this process. This will encourage investment and support as well as giving assurance to workers. It is vital that we create a culture where job creation is supported while the rights of workers are put to the forefront.

Any opportunity to strengthen the rights of workers in legislation is welcome. Recently, in my constituency of Waterford over 600 employees were given just 30 days notice by a company that was able to take away all its jobs and investment from the city in a short time frame. I welcome the legislation relating to JLCs but we need to examine industrial relations and the rights of workers, particularly in sectors such as the hospitality industry.

Tourism will be vital for Waterford and the south-east region in terms of getting the economy back on its feet. However, the service provided is only as good as the workers employed in it. This is particularly the case in the hospitality sector, which is very much built on what would be called relationship marketing. If people have a good experience, they will return and spend money in the local economy. It is fundamental that workers in this sector of the economy get a good day's pay for a good day's work. That will ensure that tourists will return and spend money in the local economy, be it in the restaurants or shops. I agree with Deputy Buttimer's comment that nobody wishes to see "To Let" notices on premises throughout city centres, as is currently the case. I welcome the legislation and I hope it will provide the stability and certainty that is required to encourage further stimulation in this sector, which I believe will be a thriving one for Waterford and the south east given the tourist attractions and facilities they can offer.

I welcome the opportunity to discuss this legislation. It is very timely. Last July, when the JLC system for protecting low paid workers was struck down in the courts, many on the Opposition benches shouted loudly that the Government, and particularly the Labour Party, would use the court decision as a convenient fig leaf to avoid fulfilling our obligations to lower paid workers. The appearance and content of the Bill clearly give a lie to those claims.

The High Court case brought successfully by John Grace Fried Chicken will not have the devastating effect on workers' rights that was initially feared. Why is that so?

The reason is that the Government has responded quickly and effectively to the vacuum created as a consequence of the court judgment. Fast food may be bad for our health and clog up our arteries but it should not be allowed to clog up the essential rights of lower paid workers or diminish their conditions and right to fair pay. To some extent, it could be argued that the case may have been helpful because unions, employers, employees and Members of the Oireachtas all knew the system of employment regulation orders and registered employment agreements needed reform. There were, however, widely differing and distinctive views on how to best achieve this.

Some of the agendas peddled in recent months were openly hostile to working people and represented a naked desire to drive down wages to the lowest possible level and trample on hard won rights at work as well as decent, albeit modest, pay. The court decision resulting in the scrapping of the system proved an unexpected boon in some ways in that instead of trying to adjust existing schemes and generate make-do, piecemeal agreements, we were able to start from a blank canvas to create a system that would protect workers and avoid tying employers into a bureaucratic nightmare such as those we have all encountered.

IBEC and others have spoken out against the Bill, with the former describing it as "misguided and unnecessary". When I hear the shrill cries and screams from some of those who peddle the view that we live in an economy rather than a society I sleep much easier at night in the knowledge that we must still be doing a good job to protect vulnerable workers who are governed by the legislation.

Under the Bill, the number of joint labour committees will be reduced to six, making them easier to understand and implement. Workers will have a clearer understanding of the system, while the maintenance and tracking of agreements will be less onerous for employees. Under the provisions, all current JLC workers will be protected in the new structure as recommended by the Duffy Walsh report published last year. This is a positive development.

The Bill makes legislative provision for companies to derogate from the terms of EROs and REAs in cases of financial difficulty through the insertion of an inability to pay clause. Critically, however, the protections afforded to workers in respect of this clause are highly robust and I am pleased the Labour Court will be closely involved in this process. This provision offers sufficient protection. The legislation to permit the joint labour committees to set three rates, a basic rate and two supplementary minimum rates, to reflect varying levels of service and experience will address many of the concerns raised in this debate. It will also substantially reduce the number of different rates applying across the EROs, while acknowledging that the freedom of JLCs to establish two higher rates for experienced employees is also very important. Measures such as the requirement that unions and employers develop a protocol or statutory code of practice on overtime and the obligation for comprehensive and ongoing reviews of the scope of each individual remaining JLC makes a great deal of sense in the fast changing environment and responds to some of the points made in the Feeney judgment.

The continued recognition that Sunday is not just another working day is very welcome. The rights of workers in respect of Sunday working will be firmly protected by a new code of practice on Sunday working to be devised by the Labour Relations Commission. This will be similar to the existing 1998 code of practice on Sunday working in the retail trade. We need to learn some lessons from how the latter code was implemented or, in some cases, not implemented.

Labour Court involvement in adjudication procedures for new ERO proposals is also a very positive step. In light of everything that has taken place previously, especially in the months since the Feeney judgment, it is clear we have not thrown out the baby with the bath water. While the judgment essentially struck out the old system of protections that was in place for a long number of years, we have ensured that the best principles, the philosophy of equity and fairness and the need to protect the often modest wages and essential rights of workers in certain very fluid sectors of the economy underpins this legislation.

The vultures may well be circling to pick holes in the Bill. I venture that they probably have a metaphorical engine running outside with a view to whisking the legislation over to the courts to have it challenged at the earliest opportunity. I am confident, however, in light of the work done on the legislation in recent months, that the proposals are as robust and vigorous as they can be in terms of withstanding potential challenges.

I pay tribute to the Minister for Jobs, Enterprise and Innovation, Deputy Richard Bruton, departmental officials and many others who were engaged in this process, in which I have also been centrally involved as I sought to achieve a positive outcome. We have invested considerable work in the Bill, as the Minister of State will be aware, and I look forward to its enactment at the earliest possible date. The positive engagement with the Minister in recent months has been an example of coalition government working at its best to resolve obvious philosophical and practical differences which emerged at an early stage of the process.

It is not in anyone's interests to see the wages of workers driven down with official legislative encouragement. It would do nothing for the struggling high streets of all the towns and villages Deputies represent. It would damage social solidarity and vital, basic, everyday economic activity. I am pleased to support the legislation and look forward to its enactment.

I will share time with Deputy Boyd Barrett. I will take as much time as I can and the Deputy will take the rest if that is fair.

I welcome the opportunity to contribute to this debate on legislation on joint labour committees and registered employment agreements. The Bill arises from a successful court challenge taken last year by a number of employers who sought to have the JLCs and REAs declared unconstitutional. Around the same time as the court case was heard, the Government published the Duffy Walsh review of joint labour committees and regulated employment agreements. This is an important report because it makes a lie of many of the arguments made by employers to justify attacking JLCs and REAs.

Duffy and Walsh estimated that between 150,000 and 205,000 workers were covered by the joint labour committee system in 2009, while between 61,900 and 78,700 workers were covered by regulated employment agreements in the same year. On these estimates, workers covered by JLCs account for 15% of private sector employees, with the retail grocery and catering JLCs accounting for more than half of these employees. They estimated that registered employment agreements account for slightly less than 8% of private sector employees, the bulk of whom are in the construction and electrical industries.

The review found that workers covered by the sectoral wage agreements do not earn a premium compared with workers who are not covered such agreements. This is an interesting finding in the context of the challenge taken by employers to the JLC and REA system. The review also found that lowering the basic JLC rates to the level of the minimum wage rate was unlikely to have a substantial effect on employment. Moreover, controlling for such factors as hours, experience, tenure, education, broad occupation and industry, the review found that the weekly wages of workers in JLC sectors are typically 7% lower than those of other workers who are not covered by a joint labour agreement or registered employment agreement. On average, those covered by REAs earned 3% less than workers who are not covered by the agreements. The authors conclude that, for covered workers, the regression results do not provide evidence that there are positive wage premiums. This finding makes a mockery of employers' claims that JLCs and EROs are a barrier to increasing employment. Where average rates are above the rates set by the orders, it is probably the case that employers are paying higher rates to ensure workers do not unionise and seek to bargain collectively. Employers are more afraid of organised workers than poorly paid workers and removing the floor is considered to be a way to push down wages and threaten workers further.

The legislation does not address Sunday premium working, relying instead on the Organisation of Working Time Act 1997 to deal with the issue. The Act sets out statutory rights for employees in respect of Sunday working. This means that under the legislation, where an employee is required to work on a Sunday and this requirement is not taken into account in the determination of pay, a number of compensation options are open to the employee in question. These include paying the employee a reasonable allowance having regard to all the circumstances, increasing his or her rate of pay by a reasonable amount having regard to all the circumstances, granting the employee reasonable paid time off work having regard to all the circumstances or providing for a combination of two or more of these measures. These provisions do not give workers sufficient consideration as they place the burden of enforcement on the worker. In many cases, workers who work on a Sunday have no choice and the payment of a premium has compensated them for the inconvenience and loss of family time. Many families on low incomes are affected and must work on Sundays. Sunday is still a very important family day and should be recognised as such with the payment of a premium. With children at school, the times families get to spend together are limited and having to work on Sundays places a heavy burden on many families.

The provisions in the Organisation of Working Time Act, which are intended to ensure compensation for Sunday working, leave a lot of scope for employers to abuse their position and do not give workers enough protection. Even today, many workers do not believe they can stand up to employers and must put up with what is on offer to them. The protection of the JLCs is vitally important to ensure that premium is maintained and that having to work on a Sunday is recognised.

The Bill also provides that employers can claim inability to pay and receive a derogation from the provisions of the Act. This must be carefully policed to ensure employers do not abuse it. If a company has a genuine difficulty, there should be scope for it, in discussion with its workers, to reach an agreement. However, it must fully disclose information to its workers and get their voluntary agreement.

Most workers are loyal to their employment and have a vested interest in ensuring the company stays viable. I have no problem with workers in any company agreeing with management a system of working which could for a period of time allow them to accept lower wages to keep the company going but it must be done in a spirit of complete partnership and equality and with the employer disclosing all the information to the workers. No worker wishes to see a company go out of business and joining the dole queue if he or she can contribute to the success of the business. Loyalty is a very important factor for workers and there is still huge loyalty among workers to their companies.

Section 13 gives power to workers or trade unions to apply to the Circuit Court to enforce an agreement. It states that no evidence will be taken from the employer and that the judge will make a decision. This places too high a burden on workers. Naturally, working people will be reluctant to go to court. There is a fear among people that courts are not places to which they wish to go. The whole judicial system is seen as elitist and not as somewhere workers, who very often may be alone, feel they can get a fair hearing and fair treatment because of the intimidating aspect of going to court and of representing themselves.

In many cases, trade unions will not support workers who need to go to court to assert their rights. That means workers will be left undefended and the potential costs and the operation of the court system will prevent them from exercising their right. Is this a deliberate intention of the Bill? I have seen cases over the past couple of years where workers have been successful at the Employment Appeals Tribunal but where employers have exercised their right to go to the Circuit Court in which workers, as a result of financial hardship, cannot defend themselves and automatically lose cases on that basis. That is unfair and the legislation should ensure that NERA or a rights commissioner has an obligation to vindicate the rights of workers through the courts, if necessary. That should be an integral part of this legislation.

In setting wage rates, the new arrangements provide that the rates should take account of comparable rates in relevant jurisdictions. This has been welcomed by the unions in that it removes the constant comparison with Northern Ireland and the UK which was used to harass workers and say they were overpaid. However, there are many other jurisdictions that could be used in a similar fashion. Does "relevant jurisdictions" include Lithuania, Estonia or Poland, places where wages are substantially lower than here? Will employers treat us to the argument that these are the people with whom we are competing but which takes no account of the situation in Ireland in which workers must live? Workers will have no choice but to participate. We should not compare wage rates here with those in other jurisdictions where they may be substantially lower. Constantly comparing them to those in Northern Ireland and the UK is wrong, as is comparing them to other jurisdictions in Europe which might have even lower wage rates. It should not happen in any circumstances.

To a certain extent the Bill protects the JLCs and REAs and maintains them into the future but there are a number of flaws in it. The inability to pay clause needs to be strengthened, the Sunday working premium must be dealt with more comprehensively than relying on the Organisation of Working Time Act and the provisions which allow workers to go to the Circuit Court to have their agreements upheld must be seriously looked at and must take into account the barriers, perceived or otherwise, in going to the courts to have those right vindicated. The rights commissioner and NERA should play a more important role and they should be the first port of call. Workers should be able to rely on them to ensure their rights are vindicated and not just make a decision in their favour. They must ensure that decision is enforced.

The starting point in discussing this Industrial Relations (Amendment) (No. 3) Bill 2011 is to remind ourselves of the workers with which this legislation deals. They are the lowest paid 200,000 to 300,000 workers, including women workers, young people, part-time workers and immigrant workers. They are also the most vulnerable. One need only look at the areas the JLCs and the EROs cover to see that is the case. We are talking about hairdressing, catering, retail, the hospitality industry, shop workers and so on. These workers are already struggling to have a decent livelihood and are struggling significantly as a result of all the other problems our economy faces which have tended to hit low and middle income families and the vulnerable sectors in our society hardest.

The events of the past few weeks have shone a light on the plight of these workers and the direction in which any legislation dealing with workers in these areas should be heading. This legislation comes up very short in that regard. I refer to the situation in Vita Cortex, La Senza, Lagan Brick, or one I heard about over the past few days which occurred last summer in the Jane Norman chain and which was a carbon copy of the La Senza situation. The appalling treatment of the La Senza workers occurred on a larger and a worse scale in the Jane Norman chain in June where workers were left high and dry in the same circumstances. They received text messages that their jobs were gone but one month's wages were still outstanding.

I spoke to a very unfortunate young woman worker who had the misfortune of working for Jane Norman and who had not been paid a month's wages and who subsequently got a job with La Senza to find herself involved in the recent occupation fighting to have her wages paid over Christmas. She is furious at the failure of public representatives, including a considerable number on the Government side who promised her the sun, moon and stars in June and that they would help her with her plight but who did absolutely nothing about it. There is nothing in this legislation which will help prevent the disgraceful treatment of the La Senza, Jane Norman, Lagan Brick and Vita Cortex workers or anybody in similar situations.

Unless we bring forward legislation to protect the rights and entitlements of workers in those situations, we are missing the point of what needs to happen in terms of legislation on workers rights and entitlements. That failure and the absence in this legislation speaks to the more fundamental problem, or the thrust or direction from which this legislation is coming. As others have pointed out, the striking down of the REAs and the EROs in the courts came from a move by employers' organisations. They wanted to get rid of even the merger protections and rights these lowest paid and most vulnerable workers enjoyed. That is the direction from which it is coming.

Debate adjourned.
Sitting suspended at 1.30 p.m. and resumed at 2.30 p.m.