Precarious work: Five solutions to employment stand-off

How State can ensure economic flexibility for employers and job security for workers

A rally in support of Dunnes Stores workers earlier this year. Photograph: Eric Luke/The Irish Times

A rally in support of Dunnes Stores workers earlier this year. Photograph: Eric Luke/The Irish Times

 

Trade unions want greater protection for workers. Employers want greater flexibility. But is there a middle ground which can provide both freedom and and job security? Here are five possible solutions to the situation.

1. Restrict zero hours

Low or zero-hour practices are the modern equivalent of a time when workers stood on street corners in the hope of “the start”.

Nowadays, they wait for a text message to say if or when they’re needed.

In essence, these contracts allow employers to hire staff with no guarantee of work.

They mean that employees work only when they are needed by employers, often at short notice.

While they’re flexible for some, for many it limits them from accessing a second job.

In theory, there is protection against this practice under the Organisation of Working Time Acts.

It gives an employee an entitlement to receive some compensation in respect of the hours they are not required to work in their contracted hours.

This entitlement is calculated on the basis of 15 hours, or 25 per cent of the contract hours, whichever is less.

According to groups like the Irish Congress of Trade Unions (Ictu), in practice, there are ways around this, through understating hours in contracts or stating that an employee is “not required” to work the hours.

Employers’ group Ibec, however, has urged the Government not to legislate against zero hour or flexible contracts, saying such a move could be detrimental to the economy.

Instead of banning the practice altogether, restrictions could limit the proportion of the workforce that can be employed using zero-hour type practices, as well as limits on the length of time that posts can be filled using these arrangement.

2. Banded hours

Workers in prearious sections of the economy are vulnerable to having their hours reduced or shifts cancelled.

Dunnes, in particular, has become a lightning rod for these issues, with employees claiming there is little certainty over their working hours.

Some say their hours can be reduced if they complain.

OECD employment protection statistics

But other large bottom-line retailers like Tesco, Penneys and Supervalu have agreed a form of guaranteed minimum hours for workers known as “banded hours” agreements.

These reflect the employees’ actual working hours, along with providing mechanisms to allow for an increase in these hours.

These collective agreements set out the precise details of the operation and provide for extra flexibility during parts of the year when demand sags.

These arrangements mean that employees are aware of their minimum guaranteed weekly working hours and the likely maximum number of hours they will be required to work.

And employers, too, still have flexibility and certainty over staffing their businesses.

3. Living wage

A campaign in the UK to help the low-paid recently signed up its 1,500th company to agree to pay the “living wage”, the income below which campaigners say it is impossible to make ends meet in the UK and the Republic.

In 2011, the Living Wage Foundation was established to give companies advice, support and accreditation.

Its accredited employers range from independent printers, bookshops and breweries to well-known companies such as Aviva, Nationwide and Nestlé.

A spokesman says these businesses recognise that “clinging to the national minimum wage” is not good for business.

Participating employers, it says, have found that paying a living wage enhanced the quality of the work of their staff, while absenteeism rates tended to fall dramatically.

In the State, a notional living wage has been set by campaigners at €11.50.

In all, it’s estimated that about one in five workers here earn below this.

Eurostat figures show the State has a greater proportion of low paid workers than other countries.

Overall, more than one in five workers were classified as low paid - earning less than two thirds of average hourly incomes - in a 2010 study.

Most agree a mandatory “living wage” simply isn’t feasible right now - but a State-endorsed “Fair Trade” style campaign, highlighting the benefits and kudos for employers who sign up to it could see the idea gain major traction.

4. Bargaining rights

The Republic lags behind many other European countries in not providing workers with collective bargaining rights.

This is despite signing up to recognise and protect the right to collectively bargain for pay and conditions.

Under legislation set out by Minister of State Ged Nash, a group of workers in any company would have a right to a hearing at the Labour Court and have their case examined in comparison with similar firms, both unionised and non-unionised.

In such cases, the Labour Court would be permitted to issue a recommendation that is binding in law and could be enforced in the Circuit Court.

The legislation is strongly backed by Labour, but opposed by some in Fine Gael.

TDs such as John Deasy have voiced concern that it could affect foreign direct investment.

Ibec says any collective bargaining must be done on a voluntary basis.

But some labour market experts point out that mandatory provisions in other European countries haven’t stopped some of the biggest firms in the world investing.

Many on both sides, however, agree that the State’s industrial relations machinery has served the country well by striking a fair balance between workers’ rights and attracting investment into the economy.

5. Strings attached to public spending

Public procurement might not be the most exciting of areas in labour law - but the way taxpayers’ money is spent in tendering for projects can have a profound effect on the way business is done.

Many European countries have adopted socially responsible clauses to procurement involving public authorities.

Both Government and businesses have signalled that such measures may not be legal and would add to the cost of public spending.

However, groups like Ictu say there is scope for a “social clause” under relevant European directives.

It could, for example, include the payment of a living wage; increased participation of women in the labour market; recruitment of people from disadvantaged areas; or the employment of long-term jobless.