Dr Donal de Buitléir
Chairperson
Low Pay Commission
Davitt Hse
Adelaide Rd
Dublin 2
23 April 2015
Dear Dr de Buitléir
I write to regarding to the public consultation process relating to the recently established Low Pay Commission of which you are the chair.
My name is Stephen Downey and I am employed as a Labour Inspector with the National Employment Rights authority and have considerable experience in dealing with employees and employers in receipt of and paying low pay. I write to you today however in a personal capacity.
First of all, I would like to apologise for the late entry of my submission. This is due to an oversight on my part that where I simply noted April 23rd rather than April 13th as the deadline. To that regard I intend to keep my contribution as brief and as concise as possible.
ONE GLOVE DOES NOT FIT ALL
This is the overriding concept behind my submission and is ultimately divided into two parts
– 1. Experience 2. Size of employment.
- Experience
Under the current legislation is in the remit of any employer to offer and any employee to accept a wage rate equal to €8.65 per hour for an experienced adult worker. An experienced adult worker being classified as someone over the age of 18yrs of age and with at least two years behind them since the first day of their employment. Without alternative, lesser rates of pay can be offered/accepted.
Therefore the concept of experience is one that has already been considered in the current legislation. However, by limiting it to two years and limiting to the entitlement of only €8.65 per hour, and no more, then a huge imbalance is created between those workers relatively new into the workforce (typically young adults free from the constraints of mortgages, childcare, other household payments) and those with long years of experience (with mortgages, families, etc…).
To that regard, the Minimum Wage is flawed as it does not take into account the premium availed by employers of loyalty, diligence and overall good performance over many years by good employees. As such I think the Commission would be well advised to consider a staggered minimum wage relating to years of service an employee offers to an employer. Such a staggered system of minimum wage may relate to a persons age, their total years in employment or their total years of employment with the same employer. Such a staggered system may span five year block where the minimum wage is increased incrementally. This would facilitate low paid workers who are loyal to their employer, and who perform their duties with due diligence over many years to at least expect a proportionate increase in their incomes and perhaps plan for a more secure retirement.
- Size of Employment
The second aspect of my submission is the size of the employment, or rather, the amount of employees hired by an employer. It stands to reason that the more employees hired the greater the investment under taken, as such the greater access to funds. In this regard, it is my view that any employer who increases their workforce is doing so purely from an investment purposes and purely for the intention to increase turnover and thereafter, profits. To do this, the employer will need extra ‘hands’ so to speak. These ‘hands’ should be included in the potential share of increased profit.
To put it simply, the more workers employed, the less the percentage of them hired on minimum wage. I think you will find that in the normal course of business that large employers will generally have few staff being paid the minimum wage but there are instances where large blocks of employees, such as in call-centres, may be paid a minimum wage whilst the nearest supervisor to them is earning a large multiple of that salary.
It is my view and one that I hope the Commission may consider, that the more an employer avails of the services of larger number of employees, that a portion of those employees must have their incomes raised. Again, a staggered system of employee numbers may be considered. An example could be that for every 5 employees, at least one employee should be in receipt of a wage equal to the minimum plus 25%. The staggered system could be set out in blocks where a current block of workers on say, €10 per hour, at least one must receive €10per hour + 25%.
This I believe would lead to a more equitable distribution of income, primarily amongst low paid workers, increasing motivation and performance and reducing high turnover rates amongst employees. It would also allow for some breathing space for small indigenous employers competing against large corporations.
That is the end of my submission. I hope it is brief and to the point and I apologise once again for not meeting the deadline. I hope the Commission may take a little time to consider the concepts behind my submission and I wish the Commission every regard in achieving its aims.
Yours sincerely
______
Stephen Downey