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Dáil
‹ Ceisteanna ó Cheannairí - Leaders' Questions

Youth minimum wage

Summary

Paul Murphy argued that young workers are legally paid below the minimum wage and described it as discriminatory poverty pay. The Minister defended wider worker supports and said the Government balances help for employees with support for employers.

Around 15,000 young people in this country are legally paid less than the minimum wage. They are discriminated against for no reason other than their age. Some of those who represent those workers in Mandate are in the Gallery now. There will be a protest by those affected at 1 p.m. outside the Dáil.

We have a national minimum wage of €12.70 an hour. It is an amount that is clearly inadequate given the cost-of-living and housing crises. However, 19-year-olds are legally allowed to be paid 90% of that, or €11.43 an hour, 18-year-olds can get €10.16 an hour and those aged 17 years and younger can get €8.89 an hour. Those are poverty wages. When these young workers go into the shop to buy groceries, they cannot offer up 70%, 80% or 90% of the cost. If they are renting, they cannot say to their landlord “Here is 90% of the rent I owe you”. If they are driving a car, they do not get a discount on their petrol.

The Minister for Justice knows that it is illegal to discriminate on age but that there is a legal exemption built in to allow young people to be paid less despite doing the same work as their colleagues in the same workplace. It is legal but it is definitely not just. Not only does it discriminate against young people but it is also used to put downward pressure on wages for older workers and to reduce hours for older workers who are on higher wage rates. An end to this discrimination would be a win for all workers.

We proposed the equal pay for young workers Bill more than a year ago to do away with this legalised super-exploitation but the Government proposed a timed amendment delaying its passage through Second Stage by a year. The excuse then was that the Low Pay Commission was due to report on subminimum wage rates. It is now a year later. The Low Pay Commission has reported and its report was very clear that subminimum wage rates should be abolished. The Government has no place left to hide. Will it now agree to progress our Bill guaranteeing equal wages for young workers?

I will finish with a quote from a 16-year-old worker who first contacted me when we introduced the Bill on First Stage. They said:

We are not asking for much, we are asking for equality and fairness for teenagers, a lot of whom helped businesses through thick and thin over the last two years. We go home from school and switch from school uniform to work uniform and go back out the door again only to earn less than our co-workers … this is insulting, discriminatory and truthfully not worth working for and all we want is to be treated the same as everyone else.

Will the Minister tell that young person today that they will be treated the same as everyone else? Will she tell young workers across the country that the time of legalised super-exploitation and discrimination will come to an end?

Comment on this

What I can say is that this is a Government that supports workers and also supports enterprise because without the businesses to create these jobs, where would we be? This Government understands that in order to create wealth and jobs for young people and everybody else we need to make sure our businesses are supported as well. We have supported workers by increasing sick pay. We have introduced remote working and domestic violence leave. We have increased parental leave and the minimum wage. In the past year alone, the minimum wage has increased by 12%, the highest percentage ever, and stands at €12.70. Those under 19, 18 and 17 years have also seen an increase in their wages.

The Low Pay Commission was asked by the Minister for Enterprise, Trade and Employment to examine subminimum youth rates. He has said clearly he will take on board the recommendations. The Low Pay Commission has looked at all the environments. It looked at a report that was commissioned before Christmas looking at the challenges that business face, particularly the businesses that we know are most under pressure in accommodation, food and the retail sectors where we know the majority of younger people work. We must take all this into consideration when any decision is being taken.

I again stress that if we do not have a business to create these jobs, these young people will not have jobs in the first instance. We have to take this into consideration. The Minister will examine the report and take into consideration all the factors impacting on business. The report before Christmas clearly set out that there were pressures on certain sectors because of the increases in costs and external factors. We need to make sure we do not do anything further that might impact on those sectors in particular. We are moving to support business overall. That is why a 15-point plan was set out by the Minister, Deputy Burke, with his colleague in the Department, setting out the measures the Government is putting in place to support businesses.

We have consistently supported workers through the measures I outlined. We need to make sure that any further changes do not negatively impact on their ability to have a job, whether part time or full time, to be able to make a living. The Minister will respond to this report. I have no doubt that a decision will be taken by the Government and that the Minister will engage with the Deputy on anything beyond that, including the Private Members' Bill.

Comment on this

I am quite struck by the Minister’s answer. I was asking about 17-year-olds getting paid €8.89 an hour - poverty wages - and she spent probably three quarters of her answer talking about all the supports for businesses that Fine Gael is going to provide. There is legalised super-exploitation of young workers taking place right now. The Government has a commission report which looked into all the things she spoke about. It looked into the impact on employment and said there is no real impact on employment. It looked into the impact on businesses and said there is no real impact on businesses. It looked into these things and made a clear recommendation. The Minister stated, however, that the Government will consider it further, despite the fact that it has just been considered by a bunch of experts. She does not display the same reticence when it comes to supports for businesses. The Government was not slow to tell businesses not to worry because it was going to delay the sick pay days or in signalling that the Government would not increase the minimum wage and would increase the PRSI threshold to benefit employers.

Small businesses lose from low pay as well, to be clear. These young workers, if they were paid properly, would be spending their money in small businesses. Why the reticence to act in the face of this unjust treatment, discrimination and exploitation, which most likely will not stand up in the context of the EU directive on adequate minimum wages? That point was also made by the Low Pay Commission. This is extremely simple. We have the People Before Profit Bill for equal pay for young workers. It should be progressed immediately. We should do away with this exploitation.

Comment on this

I do not think we can be any clearer that without employers we do not have employees. I outlined the supports we are putting in place for employers. It is important we support them. It is also important that we support employees too. That is why we have introduced sick pay and remote working for those who can engage in it.

That is why we have introduced domestic violence leave, acknowledging the challenges that people face. That is why we have introduced and are extending parental leave. That is why we have increased the minimum wage. These are all to protect workers. As the minimum wage has increased, younger workers have seen an increase in their wages.

It is the Minister who asked the commission to undertake this body of work. The commission has published it within the legally required timeline and the Minister will now consider it in the way he is legally required to do. He has stated clearly that we cannot take further actions that could impact on an industry that, from the information we gathered prior to Christmas, we know is already under considerable strain. This is not a small number of young people. Some 15,000 are impacted, approximately 45% of whom are 15-year-olds and 16-year-olds, with many of them working in the hospitality sector. For an older cohort of 5%, it is their full-time employment, but for young people, it is potentially a weekend job in a sector that we know is under pressure. We need to ensure that we do not make decisions that have catastrophic implications for the industry as a whole. That is why the Minister has committed to the economic impact assessment in the recommendations. I have no doubt that he will revert with a response in due course.

Comment on this