Tuesday, 10 February 2004

Ceisteanna (39, 40)

Dan Boyle

Ceist:

113 Mr. Boyle asked the Tánaiste and Minister for Enterprise, Trade and Employment if there are particular industries or areas in which compliance with the minimum wage regulations has been below the national average; and if she will make a statement on the matter. [3812/04]

Amharc ar fhreagra

Eamon Ryan

Ceist:

126 Mr. Eamon Ryan asked the Tánaiste and Minister for Enterprise, Trade and Employment the percentage level of compliance reported by the Labour inspectorate of minimum wage regulations; and if she will make a statement on the matter. [3810/04]

Amharc ar fhreagra

Oral answers (7 contributions) (Ceist ar Minister for Enterprise)

I propose to take Questions Nos. 113 and 126 together.

Since the introduction of the national minimum wage in April 2000, inspectors have undertaken inspections under the National Minimum Wage Act 2000, with reported compliance and sanctions levels as follows. In 2000 and 2001, respectively, 3,419 and 1,192 inspections-visits were undertaken by the inspectorate. The respective outturns for 2002 and 2003 are 1,731 and 950 inspections-visits.

In 2001 there was one conviction under the National Minimum Wage Act that concerned a failure to keep relevant records. In 2002 there were three convictions. Two of these were in respect of a failure to pay the correct wage rate — arrears were paid in both cases — and the third concerned obstruction. No sanctions were applied in 2000 and 2003. In the context of the volume of inspections-visits undertaken, the number of cases where recourse to sanctions was necessary is negligible in percentage terms.

The Deputies should be aware that rights commissioners of the Labour Relations Commission, a body independent of my Department, also investigate complaints of breaches of the National Minimum Wage Act 2000. In this regard, there are 19 employment regulation orders drawn up through the joint labour committee system that regulate statutory minimum rates of pay and conditions of employment for the significant body of workers employed in the various sectors where these apply. The rates of pay for workers in these sectors are at least the equivalent of the applicable national minimum rates and in some cases can be greater. A recent ESRI report indicates that minimum wage workers are relatively heavily concentrated in the hotel, restaurant and bar sector and, to a lesser extent, the retail sector.

However, there has been no discernible trend to date, indicating that any sector is particularly problematic in regard to compliance with the provisions of the national minimum wage.

Year

No. of Inspections

Sanction Applied

% Level Compliance Reported

2000

3,419

None

100%

2001

1,192

1 Conviction for failure to keep records

*100%

2002

1,731

3 Convictions: 1 — obstructing Inspector 2 — failure to pay NMW (arrears paid in both cases)

*100%

2003

950

None

100%

*To nearest whole number

It will not be a surprise to anyone who watched the recent RTE television programme, which is highly commendable, that the hotel, bar and restaurant sectors are mentioned in this regard. In that programme a young man worked for low wages in various establishments and reported to the public on his experiences. It was shocking to note that his wage slip for a week's work following various deductions was approximately €200. It is difficult for anyone in this city to live on that wage. The person in question ran out of money two days before his next pay day. That is a remarkable example of some of the difficulties faced by people on low wages.

If I heard the Minister of State correctly, there were approximately 900 inspections in 2002 and only one conviction, and the figures were similar for other recent years mentioned. A research document carried out by the department of economics in Maynooth found that by and large the introduction of the minimum wage has been smooth and has not presented great difficulties to companies. Does the Minister of State agree with that position or does he believe that the Small Firms Association and economic commentators are correct in stating that approximately 26% of employers have serious difficulties in paying the minimum wage? Does he believe that small businesses have a problem in paying the minimum wage or does he consider it is a fair and just rate and that the low level of convictions show that we do not have problems in this area?

It is a fair and just rate and by and large employers are happy to go along with the minimum level of pay. However, we acknowledge the point made by the Small Firms Association that compliance with the minimum wage level adds a burden which did not exist in the past. I am satisfied that €7 per hour is not an unreasonable level of minimum pay — if anything, it may be too low. That is not to say there is a great level of difficulty with compliance. By and large there are no problems with compliance. I have urged people, and do so again now, where there are examples of employers not complying with minimum wage levels, to bring such instances to the attention of our Department or the inspectorate and they will be investigated. We indicated that where there is non-compliance and an abuse of the system by employers, convictions should take place. Certainly, that has not been necessary as indicated by figures.

If I am reading the regulations correctly, I note it is an offence for an employee to provide incorrect details of his or her working hours. It is of particular concern that the detail and reporting of the working conditions of migrant workers could be easily amended to suit the legislation, when they might not be earning the €7 per hour minimum wage, apropos of what happened in the case of the tragedy on the Lancashire coast recently where migrant workers were working for incredibly low rates. Have any of the convictions related to a case where an employee knowingly provided incorrect details of his or her working hours? How can the Minister of State provide assurances that the Labour inspectorate can check the proper hours record in the case particularly of migratory workers who are fearful of their status and their work permits are held by their employers who are in a strong position? What assurances can he give that we are getting a full and frank picture of the working conditions of migrant workers?

I do not have information to hand on the reporting by employees of a fewer number of hours than they worked. I have a concern regarding the wage levels paid to some foreign workers who do piece-work. There has been some evidence in the past 12 months of foreign workers in some sectors not being paid the minimum wage because they work long hours on a piece-work basis. I refer in particular to workers in the mushroom picking industry. I take this opportunity to point out to employers in that industry that where we have evidence of workers being exploited due to working long hours on a piece-work basis and the type of work in which they are engaged not being conducive to their earning the levels of pay that should be paid — there is evidence that some foreign workers are not being adequately paid — we will pursue those employers vigorously and take them to court if necessary.

Clearly, the Minister of State has evidence in regard to the industry to which he referred, otherwise he would not have mentioned it. Has an investigation of that industry led to any of the convictions to which he referred?

I do not have specific information to hand on any particular industry. We have stepped up inspections in some industrial sectors where there have been reports of foreign workers doing piece-work who are not being paid the minimum wage.