THE MINISTER for Enterprise and Jobs says the Government’s controversial reforms of wage-setting mechanisms are fair and will protect vulnerable workers while allowing for the creation of employment.
Richard Bruton said that the measures would radically overhaul the joint labour committee and registered employment agreement systems so as to make them fairer, more competitive and more flexible so as to increase job creation.
The changes would also reinstate a “robust system of protection” for workers in sectors covered by such arrangements following a High Court ruling earlier this month.
Mr Bruton did not set out an estimate on the number of jobs that would be created under the new reforms, but he said similar changes in Britain had led to employment growth. He also said employers had forecast that up to 10,000 jobs could be created, although no hard and fast indicators had been set out for this estimate.
He said the Government would put forward legislation giving effect to the planned reforms in the Oireachtas at the earliest opportunity next term.
About 190,000 workers in areas such as catering, hotels, hairdressing, cleaning and security have their terms and conditions set down in legally binding employment regulation orders. These are produced on foot of deliberations of joint labour committees involving union and employer representatives.
Tens of thousands of other workers have their pay and conditions laid down in legally enforceable registered employment agreements which are drawn up between employers and unions in a sector and registered by the Labour Court. The largest areas covered are the construction and electrical contracting sectors.
Under the Government action plan, the number of joint labour committees will be reduced from 13 to six. They will in future have the power to set only a basic adult rate and the discretion to set two higher increments to reflect longer periods of service. Previously such committees set more than 300 different wage rates.
Joint labour committees will no longer set Sunday premium rates or any other conditions of employment covered by universal standards provided for in existing legislation. The position of Sunday working will, however, still be recognised, mainly through options set out in the Organisation of Working Time Act. These include the provision of time off in lieu.
However there is to be a new statutory code of practice on Sunday working to be drawn up by the Labour Relations Commission which will provide guidance for workers and employers on compliance with the Organisation of Working Time Act.
Under the reforms, companies will be able to derogate from employment regulation orders in cases of financial difficulty.
In setting rates, joint labour committees will in future have to take into account factors such as unemployment rates, competitiveness and wage trends here and in our major trading partners.
Under the Government’s plan, a new process will be established by which the terms of a registered employment agreement may be varied in certain circumstances without necessarily obtaining the consent of all parties to it.
It will also define more clearly the meaning of the term “substantially representative parties” in the context of those who are entitled to make such agreements.
The new legislation will also clarify circumstances when a registered agreement “may be cancelled where either the trade union(s) or employer parties have ceased to be substantially representative of workers or employers in the sector concerned and/or for other reasons related to substantial change in the sector concerned such that the continued registration of an agreement would be undesirable”.
