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Dáil
‹ Ceisteanna ó Cheannairí - Leaders' Questions

Wages and collective bargaining

Summary

Deputy Joan Collins raised the EU directive on adequate minimum wages and argued for stronger collective bargaining and a €15 living wage. The Taoiseach said Ireland is already moving toward a living wage, cited the Low Pay Commission approach, and pointed to wider worker protections such as sick pay, parental leave and auto-enrolment.

First and foremost, I want to send my solidarity to the Palestinian people and all living under siege in Gaza now. What the State of Israel is doing now is a war crime. It breaks international law. I can think of no other words to describe it than ethnic cleansing. We are speaking on this issue later but I want to call again on the Government to condemn the Israeli state and to put massive pressure on it to declare an immediate ceasefire and an immediate end to the murder it is inflicting. Any indiscriminate killing of any citizen by any group should be condemned.

I raise another important topic. Almost exactly one year ago, the EU passed a directive on adequate minimum wages. Part of the directive was the requirement for countries with less than 80% collective bargaining coverage to implement plans to increase coverage by November 2024. That is only a year away. The 80% threshold is based on trends that clearly show that most countries with a smaller share of low-paid workers and high minimum wages have over 80% collective bargaining coverage. We will continue to implement plans until we reach 80%. Ireland has a collective bargaining coverage of 33%, meaning we would need real structural changes to more than double our coverage. Sectoral bargaining will not bring that structural change. The EU passed this directive in recognition that increases in minimum wage are no substitute for a worker’s ability to negotiate his or her own pay and conditions. That means a greater ability for workers to negotiate with their own employer through their own union. Ireland has among the lowest collective bargaining trade union density in the EU. The implications of this are that Ireland has among the highest prevalence of low pay and among the highest market inequality rates in the EU. We have growing deprivation, at risk of poverty and consistent poverty rates. From my work with trade unionists, I know that workers in many sectors, especially low-paid areas such as retail, hospitality, bars, administration and workers in bogus self-employment face employers who are increasingly anti-union. The Government is on the record saying the directive will be on the agenda for the Labour Employer Economic Forum. I do not think this is good enough. The Dáil needs to see these plans before they are presented to the EU next year and there needs to be real democratic oversight of this.

To get anywhere close to the 80% threshold we will need to more than double our current collective bargaining rate of 33%.

This will require both structural changes and primary legislation. What are the Government's plans to make those changes? When will we see them? If we do not see movement on this soon, the Opposition will need to start introducing Bills to address this directive.

Comment on this
Leo Varadkar The Taoiseach Fine Gael

I am familiar with the directive; I was involved in putting it together in my last job in government as Minister for Enterprise, Trade and Employment. It has two aspects. One relates to the national minimum wage and the other to collective bargaining. On the first part, relating to the national minimum wage, we are way ahead of it already. We established the Low Pay Commission during the Fine Gael-Labour Government a long time ago. We are now very much en route to having a living wage in Ireland, calculated at 60% of the median wage. We could even get there as quickly as next year, given the significant increase of more than 12% in the national minimum wage due in January, running at roughly double the rate of inflation. I am proud to be part of the Government that has achieved that, as well as adding new protections and benefits like paid family leave and sick pay and, later this year, a pension for every worker, which we do not currently have, through auto-enrolment.

On collective bargaining, the Minister for Enterprise, Trade and Employment, Deputy Coveney, and the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Richmond, are preparing legislation in that regard, which will require good faith engagement between employers and the representative of employees, which may be trade unions or other mechanisms such as work councils. That legislation is currently being developed. It is important to point out, when it comes to collective bargaining legislation and the EU directive, that collective bargaining is not the same as forced union recognition; they are separate matters. There are ways to enable collective bargaining that can work, such as joint labour committees, JLCs, and joint industrial councils, JICs. We see that working in many sectors in Ireland, including the construction sector, for example. It is about more than minimum wages. It is also about terms and conditions, pay scales and protections, which is what we see in our employment regulation orders.

On a factual point, it is important to state again that poverty rates can go up and down in any given year but they are certainly lower than they were ten years ago. Poverty has trended downwards over the past ten years and income inequality has narrowed over the past ten years. I hope the Deputy will be able to acknowledge that in her response.

Comment on this

The EU passed that directive in recognition that increases in the minimum wage, as the Taoiseach mentioned, are no substitute for workers' ability to negotiate their own pay and conditions. That means a greater ability for workers to negotiate with their employers through their unions. The Taoiseach said that the minimum wage has been increased, which is welcome. Any increase in income is welcome but I call for a €15 living wage for workers to be able to survive in this economy from the point of view of the cost of living. Food prices will go up again this year by at least another 10%, I think - those are the indications I read the other day. That will have a huge impact on workers. I ask the Taoiseach to bring forward the legislation on which the Minister, Deputy Coveney, is working, as quickly as possible in order that we can all have a look at it and to ensure there is plenty of transparency for Members of this Dáil.

Comment on this
Leo Varadkar The Taoiseach Fine Gael

The real minimum wage, the national minimum wage, is set at 60% of median earnings. That was the recommendation of the Low Pay Commission, which the Government accepted. It was the consensus view of employers, unions and academics and it is the fairest way to calculate it. That is the target we will achieve, if not next year, then the year after. That is a big change just in the past five or six years. We are introducing a living wage, have introduced statutory sick pay and paid parental leave and, this year, we also will legislate for auto-enrolment so that every worker has an occupational pension on top of his or her State pension. I do not think any Government in the history of the State, on any objective analysis, has done more in terms of workers' rights than this Government.

Comment on this