review of the status of casual workers in ireland

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An Comhchoiste um Poist, Coimirce Shóisialach agus Oideachas Athbhreithniú ar stádas oibrithe ócáideacha in Éirinn Bealtaine 2012 ___________________________ Joint Committee on Jobs, Social Protection and Education A review of the status of casual workers in Ireland May 2012 31JSPE006

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Page 1: review of the status of casual workers in Ireland

An Comhchoiste um Poist, Coimirce Shóisialach agus

Oideachas

Athbhreithniú ar stádas oibrithe ócáideacha

in Éirinn

Bealtaine 2012

___________________________

Joint Committee on Jobs, Social Protection and Education

A review of the status of casual workers in

Ireland

May 2012

31JSPE006

Page 2: review of the status of casual workers in Ireland
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1

Joint Committee on Jobs, Social Protection and Education

A review of the status of casual workers in Ireland

Table of contents:

Decision of the Joint Committee 2

Introduction 3

1: Rationale for research 5

2: Part-time Workers

2.1: Background to Unemployment Benefit and Assistance Schemes for

Part Time Workers 6 2.2: Part-time workers in Ireland 6 2.3: Current criteria for part-time workers eligible for social welfare payment 10 2.4: Recognition of an outdated system 13 2.5: Need for work activation on a full time or part-time basis 16 2.6: International Comparisons – Casual/Part-time workers 18

3: Methodology 21

4: Report from key stakeholders 21

5: Recommendations and Conclusion 22

6: Sources 34

7: Appendices A: CSO Live Register Figures March 2012 38 B: CSO QNHS Quarter 4 2011 39 C: Dáil Question regarding „Review of the application of the Unemployment 40 benefit and assistance schemes conditions to workers who are not employed on a full time basis‟ 2007 Report D: Dáil Question regarding recipients of Jobseeker‟s Benefit 41 E: Oireachtas Committee Debate Wednesday 21st September 2011 43 F: Oireachtas Committee Debate Wednesday 21st March 2012 48 G: Written Response to PQ 25 April 2012 on changes to Jobseekers payments 54

Graphs: 2.1: Number of people on Live Register 2008- 2012 7 2.2: Number of part-time workers in Ireland 2008 – 2011 8 2.3: Number of part-time workers on Live Register 2008 – 2012 9 2.4: Claim duration of part-time workers 2012 10

Tables: 4.1: Main points raised by stakeholders 24 5.1: New hours based system versus days based system 26

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Joint Committee on Jobs, Social Protection and

Education

A review of the status of casual workers in Ireland

The Joint Committee at its meeting of 25 April 2012 considered the following

report prepared by Deputy Anthony Lawlor on behalf of the Committee on a

review of the status of casual workers in Ireland.

The report highlights inconsistencies in the system of social welfare payments

to part–time workers and makes recommendations aimed at improving

opportunities for people to return to work.

The Chairman and Members of the Committee commended Deputy Lawlor and

thanked him for the extensive work done in preparing this comprehensive

report on behalf of the Committee.

The Chairman noted his hope that the report would make a positive

contribution to improving policy on assisting people with employment

opportunities. In particular improvements suggested in the report have the

potential to provide the flexibility needed by both workers and employers to

incentivise people to re-enter the workforce and to fully realise the potential of

part-time work as a stepping stone to full employment.

The Joint Committee agreed that this report be laid before both Houses of the

Oireachtas and that a copy of the report be sent to the Minister for Social

Protection.

Damien English TD

Chairman 9 May 2012

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Joint Committee on Jobs, Social Protection and

Education

A review of the status of casual workers in Ireland

Introduction Ireland‟s unemployment benefit system, as it currently exists, is not

accommodating of the increasing number of part-time workers in our labour

force. I firmly believe that this needs to be changed if there is to be a fair and

equitable system in place. Essentially this report does not provide any new

information that is not in the public domain already. Rather it re-focuses our

attention on the current inequalities with regard to social welfare payments to

part-time workers, and the importance of urgently implementing new

guidelines to improve the system. The primary purpose of this report is to

condense the current available information into an up to date analysis of the

present situation taking into account changes to the labour market since

2008. The analysis and recommendations within this report aim to incentivize

people to re-enter the workforce and to encourage companies to hire part-

time workers. I believe that part-time work should be regarded as a stepping

stone to full time employment and every support should be offered to

individuals to return to work, on whatever basis.

Recent Live Register figures indicate an increase in the number of part-time

workers. It is therefore clear that reforms are now necessary to put part-time

workers on somewhat equal footing with other recipients of social welfare

payments. Yet this has to be undertaken in a revenue neutral manner. In

2006 the Department of Social Protection issued recommendations in a report

entitled a “Review of the Application of the Unemployment Benefit and

Assistance Schemes Conditions to Workers who are not employed on a Full-

Time Basis”1. It seems incredulous that six years later, it is only now that the

1 Prepared as an internal programme expenditure review by the then Department Social and Family Affairs

and published by the Government

http://www.welfare.ie/EN/Policy/CorporatePublications/Finance/exp_rev/Documents/ua_ub_expend_review.

pdf

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Department is in the process of considering implementing these

recommendations. In light of the current unemployment crisis, these

recommendations should have been addressed when Ireland was experiencing

full employment. It would appear that there has been a consistent failure to

enact any effective change with regard to part-time workers until now. While

I appreciate the difficulties involved in overhauling this system, I welcome the

promise by the Department that changes are due to come into force in Budget

2013. However by publishing this report I again impress upon the Department

the importance of fulfilling this promise and ensuring that real reforms are

expeditiously put in place to move toward a more fair and equal system.

I would like to take this opportunity to extend my sincere thanks to Elizabeth

Doherty (George Washington University) and Dr Eimear O‟Leary (PhD) for

their assistance in researching and writing this report. Gratitude is offered to

the representatives from IBEC, INOU, ICTU and Caremark for taking the time

to discuss and outline their views on this matter. Finally I wish to thank the

members and staff of the Oireachtas Committee on Jobs, Social Protection and

Education for allowing this report to be compiled and presented.

Anthony Lawlor TD

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1: Rationale for research

Even before the economic collapse in Ireland occurred, part-time workers

were a prevalent feature of the Irish workforce. Many people engaging in

part-time work did so voluntarily for a variety of issues i.e. working parents

with children; people with disabilities unable to work full time etc. Others

were required to work part-time due to the nature of their employment. One

profession which stands out in this regard is carers. Indeed the basis for this

research paper was founded on a discussion with the Managing Director of a

private carers‟ company who highlighted the difficulties he encountered

recruiting staff. Ultimately, carers are often only required for a couple of hours

each day to help an elderly or disabled person. Therefore, many carers are

engaged in employment, in some cases, for a maximum of 15 hours per week.

Yet because this work is undertaken each day they are ineligible to apply for

social welfare benefits to subsidise their income under the current system. As

a result, many carers offered positions by the aforementioned company are

reluctant to work such few hours per week as their income cannot be

subsidised elsewhere.

As a result of the current economic recession more and more people have

been forced involuntarily into part-time work. Often this is the only cost

saving measure available to employers who do not want to fully terminate

their employees‟ position. Alternatively many people who are now

unemployed have been offered work on a part-time basis but are reluctant to

accept such job offers for fear of losing a social welfare payment. Therefore,

an emphasis now needs to be placed on reforming the Jobseeker‟s payments

(Benefit / Allowance) system to deal effectively with part-time workers.2

2 According to the Protection of Employees (Part Time Work) Act of 2001 and for the purposes of this

report, “part-time worker” in Ireland is defined as “an employee whose normal hours of work are less than

the normal hours of work of an employee who is a comparable employee in relation to him or her”.

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2: Part-time Workers

2.1: Background to Unemployment Benefit and Assistance

Schemes for Part-time Workers

Unemployment benefit in Ireland pre dates the foundation of an independent

Irish State. Under the National Insurance Act 1911 introduced by Lloyd

George, social welfare benefit was to be paid to persons who involuntarily

found themselves unemployed in return for weekly social insurance

contributions (Kenny 2008). Conditionality for Unemployment Benefit has

always been predicated on the recipient being available for full time

employment regardless of personal choice or circumstances. However, it has

been recognised that the basis for this condition “dates back to a time when

only full-time employment was available and where the take up of flexible

employment opportunities, had they been available, would not have been an

option for the majority of workers” (2006 Report: Review of the Application of

the Unemployment Benefit and Assistance Schemes Conditions to Workers

who are not employed on a Full-Time Basis

http://www.welfare.ie/EN/Policy/CorporatePublications/Finance/exp_rev/Docu

ments/ua_ub_expend_review.pdf). Clearly Ireland has changed substantially

in the past 100 years yet 21st century standards and altered work patterns

have not been reflected in social welfare payments to part-time workers.

2.2: Part-time Workers in Ireland

The pattern of traditional employment in Ireland has changed substantially

since the downturn in the economy of 2008 with an increase in the number of

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0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

500,000

Mar-08 Mar-09 Mar-10 Mar-11 Mar-12

Persons on Live Register

atypical workers3. Unemployment is now a blight on Irish society with the Live

Register figures doubling from March 2008 to March 2012.

Graph 2.1 Numbers on the Live Register 2008-2012

Source: CSO –Live Register

The number of people on the Live Register stood at 434,054 in March 2012

(CSO). However this does not necessarily measure unemployment levels in

the state because the Live Register includes part-time (those who work up to

three days a week), seasonal and casual workers who are entitled to

Jobseeker‟s payments. Quarter 4 of the 2011 Quarterly National Household

Survey (QNHS) found that 302,000 people are currently unemployed in the

state. The Live Register is most useful in terms of the present research as it

identifies the number of part-time workers who are currently claiming

Jobseeker‟s payments.

An analysis of the CSO QNHS from 2008 to 2011 identifies the number of

people who currently work part-time in Ireland, either by choice or

involuntarily (See Graph 2.2). The overall figure (424,800) remains

somewhat stable over this period with a 7% increase (31,700 persons) in the

3 Atypical workers refer to part-time (defined hours), casual (undefined and varied hours), seasonal

(depending on demand for industry), systematic workers (hours involuntarily reduced), job-sharing and week

on/week off

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numbers employed in part-time work. However, the manner in which these

people consider themselves part-time workers has changed somewhat.

According to the QNHS individuals are classified as either „Part-Time NOT

Underemployed‟ or „Part-Time Underemployed‟. According to the CSO “a

respondent who works in a part-time job is classified as 'underemployed' if

he/she is looking and available for another job and has explicitly stated that

the hours worked currently are 'too few'”. Graph 2.2 clearly indicates how

since December 2008 part-time workers are increasingly self-classifying as

„Part-Time Underemployed‟ which leads one to conclude that part-time work is

progressively becoming involuntary with workers seeking more hours.

Graph 2.2: Part-time workers in Ireland 2008-2011

Source: CSO - QNHS

As is abundantly clear from Graph 2.3 the number of part-time workers

availing of Jobseeker‟s payments has risen sharply since the downturn in the

economy with a 75% increase. The QNHS for Quarter 4 of 2011 found that

141,500 people were classified as „Part-Time Underemployed‟ in December

2011 yet CSO figures for the same month found that 86,815 casual and part-

time workers were on the Liver Register. Therefore, almost 55,000 part-time

workers who are available for work and consider their current employment

situation unsatisfactory are not in receipt of a Jobseeker‟s payment. There

may be a number of reasonable explanations behind why these individuals are

not in receipt of social welfare payments, but it is prudent to assume that a

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9

number of these people are unable to receive a Jobseeker‟s payment because

they currently work part-time more than three days per week. Yet, in many

of these cases their personal income may still warrant state support because

of the low level of hours worked. Clearly as the number of people

involuntarily working part-time has increased a review of the current system is

required to respond to the needs of this changing workforce. The latest CSO

Live Register figures indicate that in the past six months the number of casual

and part-time workers has consistently increased from 85,029 in October

2011 to 88,716 in March 2012. This group now represents 20.4% of the total

Live Register and has seen a 3% increase in 2012 already. Clearly, it is now

time to deal effectively with this matter.

Graph 2.3: Part-time workers on Live Register 2008-2012

Source: CSO – Live Register

According figures provided by the Department of Social Protection, in January

2012, 84,004 part-time workers were in receipt of either Jobseeker‟s Benefit

or Allowance. 27% (10,985) of the total recipients of Jobseeker‟s Benefit

(41,256) were claiming this payment for between one and two years. This

statistic drops to 4% after two years. The decrease could be in part due to

claimants applying for Jobseeker‟s Allowance after their Jobseeker‟s Benefit

runs out or finding employment. Of all the individuals on Jobseeker‟s

Allowance (42,748), 29% (12,211) of claimants receive this benefit for one to

two years; after two years, this number drops to 19%. This 10% decrease

could be explained by individuals obtaining full-time employment after two

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years, indicating that part-time employment can act as a stepping stone to

full-time work. Additionally, this decrease could be attributed to part-time

workers no longer qualifying for Jobseeker‟s Allowance or Benefit because of

working in excess of three days. The next highest claim duration of

Jobseeker‟s Benefit or Allowance for part-time workers is between 3 and 6

months, at 18% of all recipients (15,499) and similarly only 18% (15,757) of

all part time workers receive either payment for more than two years. These

figures highlight the fact that even at a time when unemployment is at all-

time high, part-time workers do not necessarily remain on a social welfare

payment for long durations (see Graph 2.4).

Graph 2.4: Claim duration of part-time workers 2012

Source: Department of Social Protection

2.3: Current criteria for part-time workers eligible for social

welfare payment

Under the current social welfare system in Ireland, those who are over the age

of 18 and out of work can qualify for either Jobseeker‟s Benefit or Jobseeker‟s

Allowance. Both Jobseeker‟s payments are paid by the Department of Social

Protection, and to qualify for either, the individual must be unemployed,

capable of work, and genuinely seeking employment. The principle difference

between the two benefit schemes is that while Jobseeker‟s Benefit is generally

0

5

10

15

20

25

30

35

0-3 mts 3-6 mts 6-9 mts 9-12mts

1-2 yrs 2-3 yrs >3 yrs

%

Duration of part time claim

JA

JB

Total

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a flat rate payment for anyone who qualifies, Jobseeker‟s Allowance is means-

tested. If an individual does not qualify for Jobseeker‟s Benefit or has used up

all of their entitlement to Jobseeker‟s Benefit, he or she may qualify for

Jobseeker‟s Allowance instead.

To qualify for Jobseeker‟s Benefit, an individual must have paid enough Social

Insurance (PRSI) contributions, be capable of work, and show that they are

genuinely seeking new employment. Individuals who are receiving

Jobseeker‟s Benefit will be called by the Department of Social Protection from

time to time for an interview to prove that they are meeting the GSW

(Genuinely Seeking Work) requirements. If officials from the Department

conclude that an individual is not meeting the Department‟s requirements for

seeking out new employment, Jobseeker‟s Benefit can be stopped. An

individual can be considered unavailable for work and not qualify for

Jobseeker‟s Benefit if he or she puts restrictions on the nature of the work

available, hours of work, the rate of pay, or the location of the employment.

One would also not be qualified to receive Jobseeker‟s Benefit if he or she left

work voluntarily, lost a job due to misconduct, or refused an offer of suitable

employment. Presently, the primary requirement for Jobseeker‟s Benefit and

the one most relevant to this report is the need for the individual to be fully

unemployed for at least three days out of six. An individual could however

work on Sunday; technically working four days out of six, and still qualify for

Jobseeker‟s Benefit. However, Budget 2012 states that from July 2012 an

individual, in order to be entitled to either Jobseeker‟s Benefit, can now only

work three days out of five days. Sunday will now also count as part of a

workweek with the change coming into effect in January of 2013.

Currently, Jobseeker‟s Allowance carries many of the same qualification

requirements as Jobseeker‟s Benefit. The applicant must be unemployed,

available for and capable of work, and must be able to show that they are

genuinely seeking employment. However, unlike Jobseeker‟s Benefit,

applicants for Jobseeker‟s Allowance must pass a means test as well as the

Habitual Residence Condition. In order to qualify for Jobseeker‟s Allowance,

an individual must be unemployed; however, there are some circumstances in

which one can do some work and still receive benefits. Most importantly,

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one‟s means must show to be below a certain level to qualify for Jobseeker‟s

Allowance. Many who are unemployed seek Jobseeker‟s Allowance when they

do not qualify for Jobseeker‟s Benefit or have used up all their entitlement to

Jobseeker‟s Benefit. The new Budgetary rules which are coming into force in

July 2012 with regard to the number of days worked does not apply to this

means tested payment (see Appendix G).

Part-Time Workers Component

Currently, a Jobseeker‟s payment is only calculated in terms of days worked in

a week. Any day where an individual spends any amount of time engaged in

employment or self-employment counts as a full day worked, and one cannot

collect any payment for that day. This essentially means that even if an

individual only spends one hour working in a day, that day counts as a

workday and is deducted from any Jobseeker‟s payment for that day. For

example, if a person works for 10 hours per week, and the employment is

distributed over five days, totalling two hours per day, the individual cannot

receive any social welfare payments, since they are employed for more than

three days. However, if another individual also works for 10 hours per week,

but the employment is distributed between two days, totalling five hours per

day, that individual is entitled to social welfare payments, since they are still

technically employed for only two days out of five. Therefore, the main issue

this report focuses on is the concept that two individuals can work for the

same number of hours in a week, but based on how the hours are distributed

throughout the week, only one may be entitled to any form of social welfare

payment.

The current system does contain a special provision pertaining to casual or

part-time workers. If a claimant is engaged in subsidiary employment along

with any part-time work, the individual may still be eligible for the Jobseeker‟s

payment. For the individual to still qualify for social welfare payments, the

subsidiary employment must satisfy several conditions. The occupation must

have been followed by the individual in addition to his or her usual

employment, the occupation must have been followed by the individual

outside the ordinary working hours of his or her usual employment, and either

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the profit from the occupation does not exceed €12.70 per day, or at least 117

employment contributions must have been paid in respect to the individual in

the last three years or the last three contribution years immediately prior to

the time of the claim. In most cases, if these conditions are met and both

employments were carried out concurrently for a period of six months prior to

the claim, one occupation can be considered “subsidiary”, and the individual

can still engage in part-time work and satisfy the unemployment condition for

Jobseeker‟s payments. For example with respect to those individuals involved

in agriculture, farmers who hold other full-time employment can claim their

farming as a form of subsidiary employment. With respect to employment

shifts where the individual is required to work continuously from one day into

another, special rules apply in order to determine which day is treated as a

day of employment and which is to be treated as the day of unemployment.

The day on which the shorter number of hours is worked is generally regarded

as the day of unemployment, while the other day is treated as a day of

employment, where a Jobseeker‟s payment cannot be paid. The exception to

this rule comes into effect when one of the days in question is a Sunday. If an

individual‟s shift starts on a Saturday and extends into Sunday, Saturday will

always be considered the day of employment instead of the Sunday. If the

shift starts on Sunday and extends into Monday, Monday will be considered

the day of employment. However, this exception will no longer apply

beginning in January 2013 with the introduction of Sunday as an applicable

workday in the Budget 2012 changes.

It is also important to note that a Part Time Job Incentive Scheme currently

exists which allows long term unemployed people to work and get paid for less

than 24 hours per week and continue to receive a special weekly allowance (to

the value of €119 for a single person) instead of their Jobseeker's payment.

This incentive was introduced during Ireland's previous recession in 1986. In

order to be eligible for the scheme, one must be in receipt of Jobseekers

Allowance for 15 months or more and commit to the position for at least two

months. This scheme can run for one year, with the option to extend it.

Whilst on the scheme, recipients can continue to hold a medical card and, if

working more than 19 hours per week, may be entitled to the Family Income

Supplement.

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2.4: Recognition of an outdated system

In 2006 the Department of Social Protection recognised the then changing

work pattern and commissioned research to be undertaken to explore ways to

effectively deal with an increase in atypical workers. The „Review of the

Application of the Unemployment Benefit and Assistance Schemes conditions

to workers who are not employed on a full time basis‟ examined the

application of the unemployment payment schemes conditions to workers who

are not employed on a full time basis. This report made a number of

recommendations which, if implemented, would have brought Ireland into line

with current day realities in modern Ireland. Among others, these

recommendations included:

Using a period of 5 days in 7, including Sundays (this was implemented

in Budget 2012)

Compensation to be capped for part-time workers at three fifths of the

weekly rate

Instead of the 3 in 6 day rule, a loss of 40% employment (or 2 days)

would be necessary at the start of a claim. All other losses would then

be determined in steps of 10%

In response to a Dáil Question (No. 23617/11) of 14th September 2011

enquiring about the implementation of these recommendations, Minister Joan

Burton replied that:

The review made a number of recommendations which are under active

consideration within the Department. These considerations are taking place

in the context of the „Report on the desirability and feasibility of introducing

a single social assistance payment for people of working age‟, the current

economic situation, and the considerable administrative and IT change that

implementation of the recommendations would require.

The Oireachtas Committee on Jobs, Social Protection and Education has

recently been briefed on two occasions in relation to casual/part-time workers

by the Department of Social Protection, in September 2011 and March 2012

(See Appendices E&F). On both these occasions, the officials agreed that the

current system is outdated and that a move towards an hours based system

would be most preferable. They gave details of anomalies within the present

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system and its unfairness in certain circumstances. Yet, they consistently

highlighted the administrative and systematic difficulties which such a change

would cause. The Departmental officials also referred to the abovementioned

2006 report. They explained how when it was published, the numbers on the

Live Register were significantly lower and the sudden increase since 2008 has

impacted upon the implementation of the recommendations. During both

briefing meetings, it was pointed out by Committee members that it is

unacceptable that there was such a delay in dealing with the

recommendations of the report. Members were assured that a review of the

„review‟ is currently taking place by a departmental inter disciplinary

committee and it is hoped that the recommendations will be included in

Budget 2013.

The Employment Taskforce chaired by Wim Kok, (established following the

European Council conclusions in March 2003) in its report “Jobs, Jobs, Jobs:

Creating More Employment in Europe” clearly recognised the changing

European workforce and the need for reform. The report identified that

“Labour markets must be made more flexible while providing workers

with appropriate levels of security. Flexibility is not just in the interest

of employers; it also serves the interest of workers, helping them to

combine work with care and education, for example, or to allow them to

lead their preferred lifestyles. On the other hand, security does not just

mean employment protection, but encompasses the capacity to remain

and progress in work” (Kok 2003:9)4.

This sentiment was also reflected in a 2005 NESC Report on the

Developmental Welfare State5 which found Ireland‟s workforce increasingly

gravitating towards a more flexible structure with an increase in part-time and

casual workers.

4 http://bookshop.europa.eu/en/jobs-jobs-jobs-creating-more-employment-in-europe-pbKE5703265/

5 http://files.nesc.ie/nesc_reports/en/NESC_113.pdf

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2.5: Need for work activation on a full time or part time basis

It is generally accepted that employment is a major factor enabling people to

exit poverty and improve their quality of life. It is essential that people are

incentivised to work and to remain in the work force. It should never be more

beneficial for someone to be unemployed and in receipt of state support. In an

ideal world, this should involve incentivising people to enter full time

employment. Recent reforms introduced by the Department of Social

Protection ensure that unemployed people and those in part-time employment

are incentivised to take up full time employment where possible. However it

is clear from the above figures due to the high level of unemployment in

Ireland, full time employment is not always an option. Therefore part-time

work should be considered a viable alternative to incentivise people into the

workforce. It is recognised that combining part-time work with social welfare

payments is not an ideal situation. Yet, the aforementioned Part Time Job

Incentive Scheme (PTJI) is evidence that part time work is regarded as a

stepping stone to full time employment by the Department. One major

consequence of the state subsiding those who work part time is the cost to the

exchequer and the inflationary effect on the Live Register. One major

consequence of same is the cost to the exchequer and the inflationary effect

on the Live Register. Yet, the State should not disregard those currently

working part-time who are not in receipt of social welfare payments. There

are a number of professions where individuals work part-time on a daily basis

but are excluded from the social welfare system. Figures from the

Department of Social Protection indicate that the retail sector, security and

healthcare professions have the highest number of casual/part-time

employees, which would suggest that these would be the individuals most

adversely affected for working more days than permitted on the current

scheme. Other professions where individuals may lose benefits for working

too many days include carers, catering and bar staff, cleaning staff hired for

after-hours work, and those involved in the education sector.

The rate of long-term unemployment has increased from 7.3% in 2010 to

8.6% by the fourth quarter of 2011(Q4). Most worryingly, long-term

unemployment accounted for 60.3% of total unemployment for Q4 2011

Page 19: review of the status of casual workers in Ireland

17

compared to 51.5% a year earlier (Q4 2011: Quarterly National Household

Survey (QNHS) published by the Central Statistics Office (CSO)). The

Government is determined to tackle this problem by both creating jobs and

introducing measures to deal with work activation. Minister Joan Burton

outlined in a Dáil Response6 (No. 86 20th October 2011) that one of the pillars

used to encourage recipients of Jobseeker‟s payments to actively look for work

is by reducing the rate of payments, a measure which was introduced in the

Social Welfare Act 2010. She explained how this will

“encourage jobseekers to improve their skills in order to avoid the risk

of becoming long-term unemployed, and help them progress into

sustainable employment on a long-term basis”.

As provided for in the Programme for Government, the Department of Social

Protection is also establishing a new National Employment and Entitlements

Service (NEES). The approach now being adopted by the Department is to

move on from just being a transaction based service to actively helping clients

to re-enter the workforce or to upskill. In the Project Plan for the

Development and Implementation of the NEES published by the Department

of Social Protection in August 2011 it was recognised that

“while social welfare income support remains crucial and must be

adequate to meet needs, passive income support alone is not sufficient

if poverty and social exclusion are to be comprehensively addressed and

people are to have financial independence and reach their potential”

(Department of Social Protection 2011: 4)7.

The JobBridge Internship scheme was also introduced whereby recipients of

Jobseeker‟s payments are entitled to an extra €50 for working as an intern in

companies registered under the JobBridge Scheme. The general tenet of all

the schemes is that by entering the workforce, through an internship,

upskilling or employment, one has more chance of leaving the Live Register

and slowly coming off social welfare benefit. Encouraging part-time work

should also be considered by the government as a work activation measure

because part-time hours in a workplace can often lead to more permanent, full

time hours. Greater emphasis should also be placed on advertising the Part-

6 http://debates.oireachtas.ie/dail/2011/10/20/00084.asp

7 http://www.welfare.ie/EN/AboutUs/Documents/NEES.pdf

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time Job Incentive Scheme (PTJI Scheme). In order to do so however, the

government needs to reform how part-time workers are dealt with in terms of

Jobseeker‟s payments.

2.6: International comparisons - Casual/Part time workers

As part of the research for this report, it was deemed necessary to examine

the social welfare systems and unemployment benefits schemes available in

other countries within the European Union. In order to produce a

comprehensive recommendations review of the current social welfare system,

it was essential to conduct research on how other countries have dealt with

loss of employment and the subsequent social welfare payments.

In comparison to other large-scale unemployment benefits schemes within the

European Union, Ireland appears to have the only benefit system that

operates on a days-worked basis. Rather than receiving benefits based solely

on how many days one has worked in a week, other countries in the European

Union follow an unemployment benefits scheme based on hours worked, often

combined with other components such as former salary, time spent working

before the loss of employment, and contributions paid to an insurance fund

while still employed.

In the United Kingdom, Jobseeker‟s Allowance (JSA) is split into two

categories: contribution-based JSA, which is based on the amount of

insurance contributions one has made in previous tax years, and income-

based JSA, which is based on any income or capital the applicant and his or

her partner may have. It should be noted that if the claimant and his or her

partner have over £16,000 in savings, they are not eligible for JSA. The

qualifications for Jobseeker‟s Allowance in the UK are similar to those in

Ireland, aside from the condition applying to part-time work. Applicants in the

UK must be entered into a Jobseeker‟s Agreement, be over 18 years of age

and under the state pension age, be lawfully living in the United Kingdom, be

capable of and available for work, be actively seeking work, and the claimant

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cannot be in full-time education. With respect to part-time or casual work, an

applicant in the United Kingdom must be unemployed or working less than 16

hours per week. Unlike Ireland‟s system, the social welfare scheme in the

United Kingdom is based on hours worked in a week (not days), as long as the

applicant is still actively seeking employment.

The German system of unemployment insurance is meant to cover both

individuals who can work but are unemployed as well as those who do not

earn enough to cover basic living expenses. Similar to the United Kingdom,

Germany has two types of unemployment benefits. Unemployment Insurance

is based on the individual‟s previous earnings and is only payable for up to 12

months. In order to qualify for Unemployment Insurance, the claimant must

have worked for at least 12 months in the previous three years.

Unemployment Assistance benefits may be available to applicants after

passing a means test, if they run out of Unemployment Insurance. There is

no time limit for Unemployment Assistance, but the claimant must still be able

to work and be registered as a job seeker. With respect to part-time workers,

working more than 15 hours per week ends all benefits for a claimant.

The social welfare models in the Nordic countries particularly that of Sweden,

appear to be the systems that are the most universally acceptable and

idealistic. In Sweden, the main component of social welfare is an

unemployment insurance fund, and covers about 90% of the country‟s labour

force. This system includes a voluntary insurance scheme and a basic

mandatory scheme for those who did not wish to contribute to voluntary

insurance. Once a worker has been a full time member for twelve months,

they are entitled to receive up to 80% of their former salary in unemployment

payments. In terms of part-time work, the Swedish unemployment system

seems to acknowledge that many people searching for work will

simultaneously engage in part-time employment. Thus, the social welfare

scheme in Sweden provides unemployment benefits as long as the individual

is still available for work at least 3 hours per day or 17 hours per week.

Similar to other social welfare schemes within the European Union, Sweden

has Public Employment Services, which provides information and monitor

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jobseekers‟ progress to ensure that they comply with all of the state‟s

regulations.

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3: Methodology

The methodology employed for this research consists of a review of literature

and interviews with relevant stakeholders. In terms of the literature review,

the CSO was consulted to analyse statistics relating to the Live Register and

Quarterly National Household Survey. These statistics were used to highlight

the overarching need to deal with the issue of part-time workers. Previous

government, EU and Oireachtas commissioned reports were consulted to

obtain an overall perspective of the current situation in terms of Irish social

welfare payments and part-time workers. In order to acquire in depth

knowledge of Jobseeker‟s payments, both the Citizens Information and the

Department of Social Protection website pages were consulted. An

international comparative analysis was conducted by accessing the equivalent

Department of Social Protection website pages of each individual state and

OECD reports.

To be better informed of the widespread views of relevant stakeholders a

number of meetings were conducted. A guarantee of anonymity of the

interviewee was assured however see below for a list of groups involved in

this research. During these meetings, the interviewees were each asked the

same questions but most of the information gathered was through general

unstructured conversation. These meetings were pivotal in gaining a practical

insight into the problems experienced by part-time workers, the unemployed

and social welfare recipients. These findings formed the basis of the

recommendations made in this report.

IBEC – 9th February 2012

INOU – 29th February 2012

ICTU – 15th March 2012

Caremark – 23rd March 2012

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4: Report from key stakeholders

From a general perspective, each of the stakeholders broadly agree that

entitlement by part-time workers to Jobseeker‟s payments needs to be

reviewed due to Irish work patterns changing significantly in recent years.

Along with a change to the work pattern the characteristics of those who now

find themselves unemployed has also altered with more highly skilled and

experienced people joining the Live Register. This they feel must be taken into

consideration when reviewing the system. It is accepted that such reforms

would benefit both employees and employers. Both the INOU and the Irish

Congress of Trade Unions (ICTU) stated that an hour based system, rather

than days, would be the most effective method of reform. The Irish National

Organisation of the Unemployed (INOU) also raised the need to encourage

upskilling because a skills shortage is likely to occur. In terms of reforms to

date, the INOU regard the decision made in Budget 2012 to lower the number

of days from six to five as being regressive and one which further

disadvantages part-time workers. IBEC however felt that the JobBridge

scheme highlights how encouraging people to re-enter the workforce by way

of internship can be very effective and gave details of a number of individuals

who actually were employed full time once their internship was completed.

Despite the fact that all stakeholders were broadly in agreement, a number of

issues were identified which need to be addressed. In particular, the INOU

question employers who claim that they cannot find workers because people

would prefer to remain on social welfare benefits. They think that this number

is exaggerated and that most people who are unemployed will do everything

they can to re-enter the workplace. Yet they do agree that the current social

welfare system does not always lend itself to people partaking in part-time

work. The possibility of employers exploiting a new scheme was also brought

up. ICTU suggested that employers could take advantage of the system by

essentially dividing the day into hours and take on more employees and

reducing the hours of other employees. While this would technically give

more people jobs, it would also take hours away from current workers.

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While all of the groups agreed that some individuals choose not to return to

the workforce, they stressed the importance of maintaining an incentive for

people to look for and return to work. INOU highlighted the importance of an

incentive for people to take part time work. Individuals often refuse work

since it may cause them to lose their unemployment status and everything

that comes with it, including mortgage relief, rent supplement and

education/training schemes. This sentiment needs to be counteracted, and

thus an incentive to re-enter the workforce is vital. ICTU reiterated the need

for the maintenance of an incentive to stay in work as integral to a reform of

the social welfare system. Meanwhile, on the other side of the scheme, ICTU

noted the importance of encouraging employers to take on the unemployed.

One of the most important issues raised by all the stakeholders is the need to

keep reforms revenue neutral. Concerns were expressed that an increase in

the number of part-time workers entering the Live Register could add further

financial burden to an already strained social welfare system. ICTU

anticipated the possible burden such reforms could put on the Family Income

Supplement (FIS) scheme as well, since an increase in individuals working at

least 19 hours per week could increase the number of people applying for FIS,

putting a possible strain on the system. The INOU noted that in many cases

part time workers who are not in receipt of a jobseeker‟s payment would be in

a better financial position if they were eligible for FIS and more support should

be offered by the State to such individuals. However, as these part-time

workers would still be in receipt of a Jobseeker‟s payment they will be

disqualified from making a FIS application. Thus, with the proposed changes in

this report, there will not necessarily be a new influx of applicants for FIS.

With such reforms as the ones suggested in this report, there are clear

logistical obstacles in implementing these changes, as INOU has pointed out.

These revisions of the social welfare system would constitute an essential

overhaul of the unemployment benefits scheme. With such a large reform,

INOU stressed that it would be necessary to consider the staff and

management needed for this type of system to work effectively. More

attention would need to be paid to the branches at local level, and more staff

would be needed in order to communicate with those who are trying to re-

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enter the workforce. These logistical changes, especially at the local level,

would be necessary to allow these reforms to be implemented smoothly and

maintain efficiency in the system.

The aforementioned carers company, Caremark, is very supportive of changes

to the current system. They provided a number of examples of training

employees for a carer‟s position only for the worker to leave the job once they

realise they would not be in a position to claim benefits for working one hour

per day. An anecdotal story was also provided of an employee who was

offered three hours per day over five days but asked for management to state

for Social Welfare purposes that she worked 15 hours over two days in order

to claim benefit for the remaining three days. Management did not accede to

this request. Caremark, from a practical point of view, also complained of the

arduous „form filling‟ procedures currently in place with regard to part-time

workers in receipt of Jobseeker‟s payments and suggested a more simplified

process for staff and employers.

Table 4.1: Main points raised by stakeholders

Broadly in agreement that reform of the system is required

Advocated an hours based system rather than days

Fear that employers may exploit the situation

Incentives to come off social welfare payments and return to the workforce

Employers must be encouraged to employ part time workers

Reforms must be revenue neutral

Fear of an increased burden on FIS (Family Income Supplement)

Logistical concerns

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5. Recommendations and Conclusions

1: Hours based system

It is clear that the current system, which is based on the number of days

worked per week, disenfranchises a number of part-time workers from

Jobseeker‟s payments. The stakeholders involved in this research all agreed

that a move towards an hours based system would be much fairer and

equitable to all involved. This sentiment was also agreed upon by the

Department of Social Protection officials during the two Oireachtas Committee

briefing meetings. As defined elsewhere, part-time workers are classified as

those who work less hours than their contemporaries, however this

classification fails to define the number of hours „less‟ refers to. As a

consequence, taking into account the three in six day rule ,one person could

work two twelve hour shifts over two days and be entitled to claim three days

benefit, whilst another person could work only two hours over five days and

not qualify for benefit. This is clearly unfair due to the changing work patterns

in Ireland and the need to bring people back into the workforce, consequently

this discrepancy needs to be addressed.

For the standard employee a working week is based on the number of hours

worked with the minimum wage set on a per hour basis. Therefore, as has

been recommendation by several other sources, the same criteria should be

used for recipients Jobseekers payments who work part- time. Although the

standard working week does not have a statutory basis, according to the

National Employment Rights Authority (NERA) “the present standard working

week is 39 hours per week. The Organisation and Working Time Act 1997

states that the maximum average working week for many employees cannot

exceed 48 hours. This does not mean that a working week can never exceed

48 hours, it is the average that is important.” It has been explained that, as of

July 2012, the amount of Jobseeker‟s Benefit (this does not apply to

Jobseekers Allowance) issued will be based on one fifth of the working week,

with the minimum amount of two fifths of the allowance payable to those who

work three days per week. It is thus recommended that each one fifth

payment should be equivalent to an eight hour working day, which over five

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days amounts to 40 hours or the standard working week. From July 2012 a

recipient of Jobseeker‟s Benefit will be entitled to work three out of five days,

it is therefore recommended that this criterion should translate to 24 hours

which could be worked over five days. 24 hours however is the cut-off point.

A precedent already exists for this new system in terms of the number of

hours allowed under the Part Time Job Incentive Scheme. As the below table

illustrates this change will equate to the same level of payment to part-time

worker as is currently issued but structured in a different fashion.

Table 5.1: New hours system versus day system*

Hours based payment (40 hour

week)

Days based payment (5 day

week)

Works 8 hours per

wk

€4.70x32=

€150.40

Works 1 day per

wk

€37.60x4 =

€150.40

Works 16 hours per

wk

€4.70x24=

€112.80

Works 2 days per

wk

€37.60x3 =

€112.80

Works 24 hours per

wk

€4.70x16=

€75.20

Works 3 days per

wk

€37.60x2 =

€75.20

*Full Jobseeker‟s Payment = €188 per week/ €37.60 per day/ €4.70 per hour

There are many advantages to this system. It creates a much fairer system

whereby all part-time workers are entitled to the same benefit irrespective of

the number of days worked. Furthermore, it would bring Ireland in line with a

number of other western countries. There are obviously part-time who would

be disadvantaged by such changes. For the above mentioned worker who

works 24 hours over two days, under the present system he receives €112.80

per week in Jobseeker‟s Benefit but under an hour based system he would

only receive €75.20. This unfortunately is unavoidable if more part-time

workers are to be brought within the system.

In terms of recipients of Jobseekers Allowance, these new rules cannot apply

as this is a means tested payment (See Appendix G) and earnings for the part

time hours may affect their entitlements. Therefore the existing rules with

regard to days being counted instead of hours should remain. However,

greater emphasis should be placed on encouraging such individuals to part

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take in the Part Time Jobs Incentive Scheme. This scheme particularly assists

those who are long term unemployed, which covers a majority of people who

are in receipt of Jobseekers Allowance. Currently recipients of Jobseekers

Benefit remain on this payment for 11 months before transferring to

Jobseekers Allowance. It is therefore suggested that the time limit of 15

months for eligibility for the PTJI should be reduced to 11 months allowing

greater participation in part time work.

This report recommends that part-time work should be defined as

working 24 or less hours per week.

The Part Time Jobs Incentive Scheme should be more widely

advertised and eligibility for same reduced from 15 months to 11

months.

2: Incentivise workers

It is imperative that any change to the system will not have a negative knock-

on effect on an individual‟s entitlement to other supports. With an overloaded

social welfare system, all efforts must be made to encourage recipients to

relinquish some payments by returning to the workforce, albeit on a part-time

basis, whilst reassuring them that by doing so they will not be in a worse

financial position. Whilst realising the positive mental and health benefits of

working, it is recommended that a campaign be established by the

Department of Social Protection informing unemployed people of their rights if

they return to work. Bearing in mind that for many jobseekers they simply

cannot find work, for others they may be offered part-time work but are

unsure of how this will affect their entitlements or who to turn to for advice. It

is important that this information is freely available. For example, it is vital

that education and training supports remain in place in order to up-skill and

assist in career advancement. This includes the negative implications for part-

time who apply for a Back to Education Allowance. The NEES will play a

pivotal role in this regard and the advancement of such a transaction based

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service must be built upon. Currently, many recipients of Jobseeker‟s

payments are also eligible to a medical card. However, with the proposed

introduction of a Universal Health Insurance scheme for all by 2016,

individuals can rest assured that their medical costs will continue to be

covered despite re-entering the workforce. Furthermore, on return to the

workforce, eligibility for a medical card does not automatically cease. If an

individual has been unemployed for 12 months or more, they can retain their

medical card for three years on re-entering the workforce. During the March

2012 Oireachtas Committee briefing by the Department of Social Protection a

number of members explained how even they had not been aware of this fact,

highlighting the failure by the Department to inform even the general public of

entitlements for those re-entering to the workforce. This failure to provide

adequate information must be addressed.

In terms of Rent Supplement and Mortgage Interest Supplement, as both

allowances are means tested, the amount payable to an individual towards the

cost of rent or mortgage re-entering the workforce on a part-time basis will

decrease. However, because the rules governing both schemes state that a

recipient cannot work more than 30 hours per week, the system proposed in

this report (working less than 24 hours per week) will still allow a part-time

worker to claim some financial assistance towards their accommodation costs.

It is noted that the current system of offering assistance to parents for the

costs incurred by school going children may be affected by returning to work.

However with an increase in the household income due to payment for the

part-time work, this assistance may no longer be required.

This report recommends that a concerted effort is made from

governmental level to inform unemployed people of their entitlements

if they re-enter the workforce and reassure the public that their

financial circumstances may not be adversely affected by returning to

part-time work.

3: Must be Revenue Neutral

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The most obvious problem which may arise as a result of reforms to this

system is the cost to the state which may be incurred. If there are currently

55,000 Part-time Underemployed people not in receipt of a Jobseeker‟s

payment, bringing even a small percentage of this figure onto unemployment

benefits will increase the numbers on the Live Register. This will add extra

financial strain on an already overstretched social welfare system. It is

imperative that any changes to the system are done so in a revenue neutral

manner.

An increase in the number of people in receipt of Jobseeker‟s payment will be

somewhat financially counteracted by people receiving less means tested

benefits such as Mortgage Interest Supplement and Rent Supplement and the

Back to School Clothing and Footwear Allowance. Furthermore, with more

people re-entering the workforce, a greater number of employees will be

brought into the tax net (and possibly subjected to payment of the Universal

Social Charge if earning over €10,036) generating further revenue for the

state. PRSI contributions from employers for part-time workers will also be

contributed to the public purse. An increased household income will be spent

in the general economy consequently improving consumer confidence and the

overall financial situation in the country.

The report recognises that any changes to the system must be

revenue neutral.

4: Incentivise employers

It is not only important for workers themselves to have an incentive to re-

enter the workforce, it is vital for employers to have an incentive in hiring

people as part-time workers. By taking on part-time workers, employers will

have the chance to help those that are unemployed and provide them with the

opportunity to gain work experience and improve their standard of living.

New part-time workers can also add ideas and talent to an employer‟s

workforce, add value to an organisation, and enhance the performance or

efficiency of the organization. It may also assist small or struggling businesses

who cannot necessarily afford to take on full-time staff.

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Further, if employers were to take on part-time workers, they would

subsequently be paying less in PRSI contributions for these employees, since

the cost of the contributions would be less than a full-time worker‟s due to

their lower wages. This is in line with the halving of PRSI contribution from

8.5% to 4.25% for jobs that pay up to €356 per week since July 2011. Thus,

employers should not be deterred by the cost of PRSI contributions for part-

time workers. While incentivising people to re-enter the workforce is the most

important element in improving the social welfare system, it remains vital to

provide an incentive to the actual employers to hire these part-time workers

in order to make these changes feasible.

The report recommends that employers must be incentivised to take

on part-time workers by highlighting the advantages, both from an

economic and social perspective, of doing so.

5: Logistical Issues

With such large-scale changes in the social welfare system as this report

recommends, it is acknowledged that there will inevitably be several logistical

issues that will need to be dealt with. One of the most prevalent is regarding

the staff of social welfare offices that assist those that are out of work or in

receipt of social welfare payments at a local level. With a shift from a days

based to an hours-based scheme, it is clear that there will need to be training

for staff or information provided to allow those who work in the Department of

Social Protection to adjust to a different system. Additionally, there is always

the possibility that with an increase in the number of people on the Live

Register, who would now be eligible for Jobseeker‟s payments, there will be a

need for more staff to handle the day-to-day business of the system. With

more people eligible to receive unemployment benefits, there is also a chance

of more delays with regards to paperwork and processing.

Since there is the possibility of increased paperwork and subsequent delays, it

would be advisable to implement an online system where employees and

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employers would have a secure PIN and access to a personalised website page

with details of an individual‟s unemployment benefits and hours worked. It

suggested that responsibility should rest with the employer to log the number

of hours the employee spends working each week with the Department of

Social Protection, so that the worker receives the correct amount of

Jobseeker‟s payment. This would streamline the claims process and reduce

the amount of paperwork and delays. This would also help the agency staff,

since logging hours and keeping track of payments would be faster and far

easier.

This report recommends a streamlined, online process for logging

hours worked by a person in receipt of unemployment benefit.

Currently, one of the most important aspects of receiving jobseekers

payments is that an individual fulfils the Genuinely Seeking Work (GSW) and

availability requirements. One that is out of work and receiving jobseeker‟s

payments must prove that they are available for work and actively seeking

employment, by way of letters, attendance at interviews, proof of CV‟s being

sent to organizations, etc. With a change in the system from days-worked to

hours-worked so as to include more part-time workers, some may argue that

these part-time workers may not fulfil the GSW requirements, since they are

supposedly spending more time working. However, it should be noted that

this change should not largely alter the present system. The NEES will

continue to be a transaction based body which actively assists individuals to

re-enter the workforce and recipients of unemployment benefit will still be

required to provide proof of seeking full-time employment. With reference to

availability for work requirement, because the maximum amount of hours

worked would be the equivalent to the three days currently allowed, the same

rules which presently exist will continue.

This report recommends that part-time workers in receipt of

unemployment benefit will continue to prove that they are actively

seeking and available for work.

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Conclusion

After extensive analysis of the current unemployment benefit scheme, it is

clear that changes to the system should have been put in place several years

ago. If one person can work ten hours a week distributed over two days and

receive unemployment, but another individual can work the same ten hours

but distributed over five days and not be eligible for any social welfare

payment, the system currently in place is decidedly unequal. Those who are

unemployed and on the Live Register should not be discouraged from seeking

part-time work, and should not feel that it is more of a benefit to them to

remain entirely unemployed and receive social welfare than to engage in part-

time work. It is vital for Ireland to have a fair and equitable system in regards

to those who are unemployed and want to re-enter the workforce by seeking

part-time employment. However, such a change to the system must be done

on a relatively revenue neutral basis without having an overall negative

impact on the Live Register figures.

The recommendations included in this report, although comprehensive, do not

require drastic changes to the system. It is merely a rearrangement: with a

maximum of 24 hours per week considered part-time, this averages out to 8

hours per day, which is considered three days of work. Thus, workers would

still only be working a maximum of three days to qualify for jobseeker‟s

payment, but those three days would be counted in hours instead of full days.

This way of calculating benefits is more equitable as well as practical, and

allows those individuals who only work a few hours a day to still be eligible for

social welfare payments. These changes would still follow the same

parameters as the current system; the scheme would simply be rearranged in

order to accommodate more part-time workers.

These are reforms that should have been implemented before this point, while

unemployment was still at a low level and such changes would have been

easier to make. The report released by the Department of Social Protection

referred to in this report, „Review of the Application of the Unemployment

Benefit and Assistance Schemes to Workers who are not Employed on a Full-

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33

Time Basis‟, was released back in 2006, when unemployment was under 5%,

as compared to the current unemployment rate of over 14%. While these

reforms should have been made several years ago, when the country had a

lower number of people on the Live Register, changes still need to be made as

soon as possible even if doing so will be more difficult. With so many people

unemployed, we should be encouraging people to try and enter the workforce,

even if it is only part-time work. By going ahead with the reforms suggested

in this report, we will be taking a step toward improving the standard of living

and creating a fairer and equitable social welfare system.

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“Review of the Application of the Unemployment Benefit and Assistance Schemes

Conditions to Workers who are not Employed on a Full-Time Basis”. Department

of Social Protection. 2007.

“Spain”. Benefits and Wages: Country Chapters. OECD. 1 July 2009.

http://www.oecd.org/dataoecd/10/10/47346797.pdf

“Sweden”. Benefits and Wages: Country Chapters. OECD. 1 July 2009.

http://www.oecd.org/dataoecd/10/41/47346621.pdf

“Table: Unemployment Benefits”. Tax/Benefit Policies: Overview for Selected Years.

OECD. 2007.

"The Developmental Welfare State." National Economic Social Council 113. National

Economic and Social Development Office, May 2005.

<http://www.socialinclusion.ie/documents/NESCDevelopmentalWelfareState.pdf>.

"The Working Week." Citizen's Information. 3 Apr. 2012. Web.

<http://www.citizensinformation.ie/en/employment/employment_rights_and_condi

tions/hours_of_work/working_week.html>.

“Unemployment and Job Seeking in Germany”. Angloinfo: Berlin.

http://berlin.angloinfo.com/countries/germany/unemploy.asp

“Unemployment Benefit in France”. French-Property.com. 15 April 2009.

http://www.french-property.com/news/money_france/unemployment_benefits/

“Unemployment Benefits”. Nordic Social Insurance Portal. Norden.

http://www.nordsoc.org/en/Sweden/Unemployment1/

“Unemployment, Benefits, and Job Seeking in France”. AngloInfo: French Riviera.

http://riviera.angloinfo.com/countries/france/employ.asp

“Unemployment Insurance”. The French Social Security System. Cleiss: Au Service de la

Protection Sociale a L‟international.

http://www.cleiss.fr/docs/regimes/regime_france/an_5.html

“Unemployment Pay”. Sweden.se.

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http://www.sweden.se/eng/Home/Work/The-Swedish

system/Employment_based_benefits/Unemployment-pay/

“United Kingdom”. Benefits and Wages: Country Chapters. OECD. 1 July 2009.

http://www.oecd.org/dataoecd/10/28/47346497.pdf

“Working Part-Time”. Citizens’s Information. 21 February 2012.

http://www.citizensinformation.ie/en/employment/types_of_employment/part_time

_employment/part_time_workers.html

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7: Appendices

Appendix A: March 2012 Live Register Figures

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Appendix B: QNHS Quarter 4 2011 Figures

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Appendix C

Ref. No. 23617/11

To the Minister for Social Protection

To ask the Minister for Social Protection her plans to implement the recommendations of

the review of the application of the unemployment benefit and assistance schemes

conditions to workers who are not employed on a full time basis which was published in

2007; the recommendations that are likely to be considered; when such a reform of the

current system will take place; and if she will make a statement on the matter.

- Anthony Lawlor.

* For WRITTEN answer on Wednesday, 14th September, 2011.

REPLY

Minister for Social Protection (Joan Burton T.D.)

The jobseeker's benefit and jobseeker‟s allowance schemes provide income support for

people who have lost work and are unable to find alternative employment. It is a

fundamental qualifying condition for these benefits that a person must be available for full-

time work.

It is recognised that a changing labour market has resulted in a move away from the more

traditional work patterns, with a consequent increase in the number of atypical workers. In

response, the Department conducted a „Review of the Application of the Unemployment

Benefit and Assistance Schemes Conditions to workers who are not employed on a full-

time basis‟ which examined the application of the jobseekers benefit and allowance

scheme conditions to workers who are employed part-time, casual or systematic short-time

basis.

The review made a number of recommendations which are under active consideration

within the Department. These considerations are taking place in the context of the „Report

on the desirability and feasibility of introducing a single social assistance payment for

people of working age‟, the current economic situation, and the considerable

administrative and IT change that implementation of the recommendations would require.

ENDS

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Appendix D

Question No. 86

Ref No: 30448/11

To the Minister for Social Protection

To ask the Minister for Social Protection the steps in place to ensure that persons who are

in receipt of jobseeker's benefit are actively seeking employment; the measures taken to

deal with social welfare recipients who have refused a job offer; and if she will make a

statement on the matter.

- Anthony Lawlor.

* For WRITTEN answer on Thursday, 20th October, 2011.

R E P L Y

Minister for Social Protection ( Joan Burton T.D )

The jobseekers schemes provide income support for people who are seeking their first job

or have lost work and are seeking alternative employment. A fundamental qualifying

condition for both the jobseeker‟s benefit and jobseeker‟s allowance is that a person must

be available for and genuinely seeking full-time work.

To satisfy this condition, it is necessary for the person to demonstrate that he or she has

taken some positive action and is making genuine efforts to secure employment. If a

person fails to satisfy this condition his/her claim will be disallowed. In addition, an

unreasonable refusal to accept an offer of suitable employment may also lead to a

disallowance.

The National Employment Action Plan (NEAP) is the main activation measure for

jobseekers and provides for a systematic engagement of the employment services with

unemployed people. The NEAP process is a key element in addressing the progression

needs of those on the live register. It provides a stimulus to job search and affords an

opportunity to explore, under professional guidance, the full range of employment and

training services offered by FÁS.

As one pillar of this overall approach, reduced rates were provided for in the Social

Welfare Act 2010, which will encourage jobseekers to improve their skills, in order to

avoid the risk of becoming long-term unemployed, and help them to progress into

sustainable employment on a long-term basis. The intent of the reduced rates is to ensure

compliance with the activation processes. Basically, there is a right to a payment but also

a matching responsibility on the unemployed person to engage with the system. This, I

think, is a reasonable approach from the individual‟s and the taxpayers‟ perspective.

The reduced rates, which apply to personal jobseekers payments, may be implemented

where a jobseeker:

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i) refuses an appropriate offer of training by an officer of my Department;

ii) refuses, or declines to avail of, an offer of training from FÁS;

iii) declines an intervention under the NEAP;

iv) does not attend NEAP meetings with a FÁS officer;

v) drops out of the NEAP process.

The relevant legislation provides safeguards for the social welfare recipient in terms of the

reasonableness of the intervention being offered. In common with many social welfare

provisions, the new measures allow for discretion on the part of a deciding officer, as an

offer of training, education or employment must be viewed in the context of a person‟s

circumstances. Where a customer has been subject to the reduced rate, the normal rate of

payment will be restored from a current date when the person subsequently engages with

the NEAP process or takes up offers of training that were made.

The NEAP is central to ongoing development in the labour market policy area and will be

progressed within the framework of a new National Employment and Entitlements Service

which, as provided for in the Programme f or Government, is being established by the

Department. The new service will integrate employment and benefit payment services,

currently delivered by FÁS and the Department, respectively, within the Department and

will be based on a case management approach with the objective of providing a more

customised and personal service to customers.

In line with good international practice, this new service will focus primarily on activation.

The objective is to encourage and enable customers to embark on developmental pathways

appropriate to their needs; pathways to employment, training and /or personal

development. The objective of the new service is to offer users a high level, personalised

employment support and prioritise the provision of more intensive support for those on

the live register who are identified as being most at risk of long-term unemployment. A

key feature of the new service will be that customers will be expected to engage with these

options in order to retain their entitlement to full benefit payments. The measures outlined

above support this approach.

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Appendix E

Oireachtas Committee on Jobs, Social Protection, and Education,

Barriers to Employment: Discussion with Department of Social Protection

Extracts from Debate referring specifically to casual workers

Wednesday 21st September 2011

The Joint Committee met at 9.30 a.m.

MEMBERS PRESENT:

Deputy Ray Butler, Senator John Kelly,

Deputy Áine Collins, Senator Michael Mullins,

Deputy Michael Conaghan, Senator Feargal Quinn.

Deputy Tom Fleming,

Deputy Brendan Griffin,

Deputy Seán Kyne,

Deputy Anthony Lawlor,

Deputy John Lyons,

Deputy Nicky McFadden,

Deputy Mary Mitchell O‟Connor,

Deputy Aodhán Ó Ríordáin,

Deputy Aengus Ó Snodaigh,

Deputy Brendan Ryan,

In attendance: Senator Fidelma Healy Eames.

DEPUTY DAMIEN ENGLISH IN THE CHAIR.

The joint committee met in private session until 9.35 a.m.

Chairman: I welcome Mr. David Dillon, principal officer; Mr. Paul Morrin, principal

officer; Mr. Pat McDonnell, assistant principal officer; Mr. Joe Meehan, assistant principal

officer; and Ms Patricia Molloy, assistant principal officer, from the Department of Social

Protection. By virtue of section 17(2)(i) of the Defamation Act 2009, witnesses are

protected by absolute privilege in respect of their evidence to this committee. If they are

directed by it to cease giving evidence on a particular matter and continue to so do, they

are entitled thereafter only to qualified privilege in respect of their evidence. They are

directed that only evidence connected with the subject matter of these proceedings is to be

given and asked to respect the parliamentary practice to the effect that, where possible,

they should not criticise or make charges against any person, persons or entity by name or

in such a way as to make him, her or it identifiable. Members are reminded of the long-

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standing parliamentary practice to the effect that they should not comment on, criticise or

make charges against a person outside the Houses or an official by name or in such a way

as to make him or her identifiable. I ask Mr. Dillon to begin the briefing on proposals to

remove barriers to taking up employment where real income is reduced when social

welfare benefits are lost.

Mr. David Dillon: I thank the Chairman and members of the joint committee for the

invitation to discuss this issue. Mr. Paul Morrin is a principal officer in the Department. He

is on secondment from the Central Statistics Office where he was engaged as a statistician.

He works on the dynamics of the live register which is germane to these proceedings. Mr.

Pat McDonnell works with me on the issues of unemployment and activation policy. Mr.

Joe Meehan who is based in our Sligo office deals with rent allowance and associated

matters. Ms Patricia Molloy who is based in our Carrick-on-Shannon office deals with

operational matters.

The topic under discussion is wide and open-ended. Therefore, what we have attempted to

do in the material we have given members is provide a degree of context and an indication

of behaviours in respect of the live register. The subject matter receives some press

coverage from time to time. We have detailed instances which I will go through. I will also

indicate how they reflect replacement rates; the interaction with other schemes such as rent

supplement, and some policy directions, including in respect of the advisory group on tax

and social welfare and the general national employment and entitlement service, NEES.

Deputy Anthony Lawlor: I also read the document last night, which gave a great insight

into the whole social welfare system. The change in work practices surrounds short-term

employment involving people coming into part-time jobs and how that affects their social

welfare payments. A number of people have told me how difficult it is if they get a job for

one or two days a week, or if they work two or three hours a day. When they go back to

the social welfare office they may find it extremely difficult to get their due entitlements

back. The system does not seem to be flexible enough to deal with our modern workforce.

In 2007, a review was published of the application of the unemployment benefit and

assistance scheme conditions for workers who are employed on a full-time basis. It made a

number of recommendations and I would like to know how far down the road we are with

those recommendations.

People may be working two hours per day until they build up the number of hours,

particularly in the care sector. Care organisations find that people do not want to take up

such jobs because they will lose a full day‟s entitlement as a result. Perhaps we should

consider people on an hourly basis, rather than a daily basis. In that way, if they work ten

hours a week they would be entitled to 25 hours of social welfare payments. Perhaps we

should start thinking about that, although there may be cost problems associated with it.

Mr. David Dillon: The review the Deputy mentioned is referred to in the Department as a

typical review for convenience purposes. As he rightly said, that was published in 2007.

One of the features of our unemployment system is, and has been for a long time, that it is

predicated on the day of unemployment. One gets paid in respect of days on which one is

not employed.

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The unemployment week is a six-day week and Sunday is not included as a day of work.

As a test of unemployment, a person employed more than three-in-six days - three days in

any six-day period - is considered not to be unemployed and, therefore, does not get a

payment. As Deputy Lawlor stated, that bears an increasingly small relationship to the

world of work at present, with the growth in atypical employment, casual part-time work,

etc., being more of a feature.

One of the facets of the current three-in-six days unemployment week is that part-time

workers, depending on how they arrange their week, can be in a couple of anomalous

situations. If somebody is only working part time and only available for part-time work

and if he or she gets let go from that part-time work, he or she will not qualify for any

payment. Therefore, there is under-compensation. The person‟s part-time activity is not

recognised and he or she has not got paid. The second aspect of the part-time work is that

if somebody is working part time and gets let go, and is available for work, he or she will

get paid for a full week‟s work. Such a person will get paid for six days and gets over-

compensated. Some part-timers will be under-compensated in the current system; some

part-timers will be over-compensated.

On the three-in-six rule, if one goes to four-in-six one loses payment for the full week.

That is a barrier. That is a structural problem within the system. People are reluctant to

take on that extra day and employers, in those circumstances, will find it difficult to fill

certain types of employment.

Another feature is, increasingly, people are being offered two or three hours a day or two

or three hours a morning over five days, and that does not square with the current system.

Recognising all of those, the Department commissioned and carried out a value-for-money

report, and came up with recommendations. The recommendation, for unemployment

benefit recipients who are employed part time, is to move away from the concept of the

day of unemployment and move to a system that recognises loss of hours and loss of

money, a combination of both. We need to proceed on that.

Persons who work part time are known in our system as “casual”. At the time the

Department commissioned that report, there were 20,000 casuals on its books, of whom

16,000 got paid in any given week. This is because peoples‟ work patterns will change and

not everyone who satisfies the three-in-six rule this week will satisfy it next week, etc.,

because they will be doing cover, etc. Of the 20,000 registered casuals, a rolling 16,000

were getting paid in any given week. The number of casuals is now at 83,000 or 86,000,

with the change in the economy. It is of a scale that is much more significant that it was

then.

Of the 20,000 casuals of whom 16,000 were working, there was under-compensation and

over-compensation. Persons were adjusting their patterns to suit the welfare week. Sunday

is not included as one of the welfare days and persons can work Sundays and it does not

affect their welfare entitlement - it does not come into that three-in-six equation I

mentioned earlier. Our systems are established and set up to pay on a six-day week. There

are significant ISD requirements required to move to a seven-day week. There are

significant administrative and structural issues in our local offices to change from a six-day

week to a seven-day week and move to an hours basis. Finally, because there will be

winners and losers in this if the Department goes down the route recommended in the

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report, there is that issue of how that is played out to consider as well. Does one save those

who are currently doing this and if one saves those, does one perpetually trap them at that

lower rate of participation, etc.?

In light of the change from 16,000 casuals to 83,000 who are getting paid now, we are

looking at having an outsider update the review, that is, have a quick relevance check on

the review to see how relevant the recommendations still are to the changed circumstances

with a view to proceeding. If that gets proofed, we intend proceeding to make the changes

because there have been significant ISD developments in the past couple of years in the

Department to make the changes to allow us to move to that recognition of hours lost and

money lost for atypical employment. Therefore, it is on the cards but it is slow to move

because it is significant.

Chairman: Is that report four years old?

Mr. David Dillon: Yes, late 2007.

Chairman: It sat there for four years.

Mr. David Dillon: It sat there, it was considered. There are the impact assessments and

there is ISD. There is an ISD queue for development, etc. There are other issues. It has not

been enacted but that is not to say it sat there, if the committee knows what I mean. There

is a slight difference.

Deputy Anthony Lawlor: If it has not been enacted, it was sitting there. I agree with the

Chairman on that.

Mr. David Dillon: It was known about. It is on the radar. It is in the queue for

development work, etc.

The other change since it came out was in 2008 the numbers coming through the doors

mushroomed, as did the space and capacity to make any change. On the changes required,

if the live register had stayed as it was, at 165,000 or 180,000, the changes required would

still be significant in that context. They are of an order of magnitude bigger with the

changes that have happened since 2008 on the live register. Even for the 20,000 casuals

and rolling 16,000 equation I mentioned earlier, it would require significant development.

If one must change the organisation for 5,000 persons, one must change it for 80,000. The

changes are significant. I might be a little Jesuitical in my differentiation. It has not sat

there. We have been aware of it and it has been in a queue, so to speak, of work.

Chairman: It is something we can work on.

Mr. David Dillon: It is something we can work on.

Chairman: It has become more urgent.

Mr. David Dillon: When we move, in this space there will be winners and there will be

losers. Persons have changed their behaviour or persons are manipulating their behaviour

and, logically, shaping their work and participation patterns to suit the system, and that

does not suit everyone.

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Interestingly, as part of that, Lansdowne Market Research was commissioned to do a

survey of casual workers and employers who were employing casuals. The casual workers

were all saying the employers are not offering any more work and the employers were

saying that they were offering them all the work they could get. That is the space it is in.

There are different narratives out there around these people.

It is out there and we plan to move on it. We just need to audit the recommendations in

light of the changed circumstances and then begin a process of implementation.

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Appendix F

Oireachtas Committee on Social Protection, Jobs and Education Report from Ms.

Kathleen Stack, Assistant Secretary Department of Social Protection,

Extracts from Debate referring specifically to casual workers

Wednesday 21st March 2012

The Joint Committee met at 09.30 a.m.

MEMBERS PRESENT:

Deputy Ray Butler, Senator John Kelly,

Deputy Áine Collins, Senator Michael Mullins,

Deputy Joan Collins, Senator Feargal Quinn.

Deputy Tom Fleming,

Deputy Seán Kyne,

Deputy Anthony Lawlor,

Deputy John Lyons,

Deputy Mary Mitchell O‟Connor,

Deputy Aengus Ó Snodaigh,

DEPUTY AODHÁN Ó RÍORDÁIN IN THE CHAIR.

Vice Chairman: I welcome Ms Kathleen Stack, assistant secretary of the Department of

Social Protection, Mr. Philip Cox, Mr. Bernard Tonge and Mr. David Dillon, principal

officers, and Ms Geraldine Gleeson, chief appeals officer.

Members are reminded of the long-standing parliamentary practice to the effect that

members should not comment on, criticise or make charges against a person outside the

Houses or an official either by name or in such a way as to make him or her identifiable.

By virtue of section 17(2)(l) of the Defamation Act 2009 witnesses are protected by

absolute privilege in respect of their evidence at this committee. If you are directed by the

committee to cease giving evidence in relation to a particular matter and you continue to

do so you are entitled thereafter only to a qualified privilege in respect of the evidence.

You are directed that only evidence connected with the subject matter of these proceedings

is to be given and you are asked to respect the parliamentary practice to the effect that

where possible you should not criticise nor make charges against any person or persons or

an entity by name or in such a way as to make him, her or it identifiable.

I believe Ms Stack has two presentations and I ask her to begin, with Ms Gleeson to

follow.

Kathleen Stack: I would like to briefly look at the question of casual workers claiming

social welfare benefits. At present, in excess of 93,000 jobseeker‟s benefit and assistance

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clients are engaged in regular casual employment. The work situation for these clients falls

into two main categories. First, some 85,000 are involved in the casual and part-time

worker category. These include those involved in work traditionally described as casual in

that it involves employment where the person has no assurance of being re-employed with

the same employer on an ongoing basis. The employment is typically for a few occasional

days and the number of days involved depends on the level of activity in the employer‟s

business. Also included in the general description of casual workers are those involved in

part-time employment. These clients have an ongoing expectation of employment from the

same employer, although the number of days and the hours per week vary. This category

encompasses some 43,000 jobseeker‟s assistance and some 42,000 jobseeker‟s benefit

clients.

Second, there is also the systematic short-time category. This covers employment where

the person works on a reduced number of days in the working week on a systematic basis.

In these cases, there must be a clear repetitive pattern of employment each week, for

example, one, two or three days in each week - or perhaps two days this week and five

days next week - with that cycle repeated on a systematic basis. There are over 8,000

jobseeker clients in this category.

All jobseeker customers in these categories must give a written declaration of the days

they work on a weekly basis. To receive a jobseeker payment for that week, the customer

must have been unemployed for three days in the previous six-day period. On the

jobseeker‟s allowance scheme, 60% of the client‟s earnings from employment are taken

into account in calculating the rate of payment, with €20 per day bring disregarded for

associated employment expenses - subject to a maximum of €60 per week.

This issue of casual workers was discussed last September at a previous presentation by

the Department. At that time, it was recognised that there had been significant changes in

the labour market in recent years. It was recognised that there had been a significant

increase in what is termed atypical employment and that, for many, the traditional nine to

five pattern of employment was increasingly no longer the norm. The Department‟s

jobseeker schemes generally reflect this traditional pattern as they are based on the concept

of a day of unemployment in the context of a six day week. In this regard, there was some

discussion about the Department‟s report - Review of the Application of the

Unemployment Benefit & Assistance Schemes Conditions to Workers Who Are Not

Employed on a Full-Time Basis - which includes, inter alia, recommendations to move

away from the day of unemployment concept and introduce a system that incorporates

recognition based on hours. Such a system would be more flexible than the current one and

would serve to encourage people to take up part-time employment. The Department

recognises that this can be important in helping people back into the labour market and

provides a significant first step leading to full-time employment.

However, moving from the current system to the one envisaged in the report involves

degrees of complexities and an inter-disciplinary group has been established within the

Department that is tasked with resolving these issues. It is intended to have

recommendations ready for inclusion in the next budget. In conclusion, I hope I have given

the committee a good sense of the work in progress in the Department in these areas and I

welcome any comments and views.

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Deputy Aengus Ó Snodaigh: My questions concern both presentations, the first of

which is Ms Stack whom I thank her for the presentation. The other part of the

presentation was on casual or part-time workers. Have any changes been made in that

regard? Currently, people on jobseeker‟s allowance must give a written declaration if they

are working on various days. Has that system been made any easier? I asked that question

of a colleague of Ms Stack in a previous presentation. For instance, if someone gets a

day‟s work and they have the option to do an additional day is it possible for them to text

the Department with their PPS number and the day they will be working, given that will

result in a saving to the Department because it would not have to pay for that day?

There is often a concern among those on jobseeker‟s allowance in particular that if they

state they are working for a period of time they will lose their entitlement to fuel

allowance, back to education allowance and so on by delaying their availability. Those in

receipt of the back to education allowance in particular appear to be discouraged in that

regard because the timeframe is tight and they are discouraged from taking up work in that

period. Some of them might chance their arm and opt for work in the black economy.

Vice Chairman: Does Ms Stack wish to respond to some of those issues before we

proceed?

Mr. Bernard Tonge: As I understand it, the question refers to the Department allowing a

casual jobseeker customer use SMS texting to declare their employment in a particular

week. There are no current plans for that. The Department is extending the use of text

messaging to its customers to remind them of appointments they have and of their next

signing day arrangements. It does not plan to use text messaging for declaring the

unemployment pattern. As Ms Stack stated in her presentation, for casual workers there

must be three days of unemployment in the previous six days. That declaration must be

made on a weekly basis. Currently, and for the last number of years, it was made on what

we call a casual signing docket where the person would put in their days of unemployment

etc. We have automated that process now and are hoping to expand into the use of

scanning that facility when it is returned, thereby removing some of the clerical effort.

More particularly, from the perspective of the customer we are introducing an on-line

facility where the customer can go on-line and declare their unemployment pattern. That

facility is working on a pilot basis in one local office at the moment and depending on how

it progresses, we will extend it to other offices over the coming months.

Deputy Anthony Lawlor: I have a number of questions for the witnesses. In the mid-

1980s we had problems associated with the black economy. Have we learned from

previous experiences and was any report done at that stage in regard to how we could

address the black economy issue? On security of PPS numbers, it is easy to access another

person‟s PPS number and use it. I welcome the proposed online facility for use by casual

workers. Has the use of other more secure methods, such as fingerprinting or eye-

scanning, in respect of people in receipt of social welfare benefits been considered given

the concerns in relation to security of PPS numbers?

On casual workers, I have a copy of a report published in 2007 which includes a number of

recommendations in regard to casual workers. The joint committee is currently engaged in

work in the area of casual labour. In January 2008, there were 20,000 people engaged in

part time work. In January 2009, there were approximately 65,000 people engaged in part

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51

time work. The current figure in this regard is 85,000. It was stated it is proposed to

address this issue in budget 2013.

I am alarmed to hear that some of the recommendations of this report have not been acted

upon. Why is that? The report proposed positive changes in the working regime in this

country yet almost seven years later little has been done. The labour market moves rapidly.

It is a shame to say that the Department of Social Protection does not appear to move at all.

It is a criticism of the departmental officials that there has been no change in the casual

working area. I will provide an example. I can work ten hours a week and claim three days

payment but if Deputy Kyne works work ten hours a week, in the form of two hours per

day, he will not be entitled to any payment. That is not fair. It now appears there will not

be any change, in terms of what is being proposed, until budget 2013. We need to get off

the fence on this. The objective is to get people back to work, be it for one hour, two hours

or three hours per day, potentially leading to full time employment. What we are currently

doing is restricting this. I apologise if my remarks on this appear strong but they need to be

stated.

Ms Kathleen Stack: I will ask Mr. Dillon to comment on the part-time work issue as he

is more closely associated with the 2007 report.

Mr. David Dillon: When I appeared before the committee in September we discussed the

report. After the hearing in September a decision was taken to proceed with it, examine its

recommendations and ensure provision can be made for their introduction in the budget for

2013.

A degree of complexity is involved in changing the system operationally, administratively

and with regard to the impact on customers. The report recognises that problems exist in

the current system, with elements of overcompensation and under-compensation some of

which were highlighted in the examples given.

Moving to the concept of hours and away from the concept of a day with regard to

unemployment is more flexible. We recognise flexibility is required in the labour market,

and we are using the legislative windows available to us and considering the impact on the

current administration and the information systems division. We are working on it and we

will make recommendations in the next budget.

Deputy Anthony Lawlor: The question I asked is why it took so long.

Mr. David Dillon: The report was issued in the context of social partnership. Employers‟

bodies made observations as did ICTU, and winners and losers come out of the report.

That is its context.

Deputy Anthony Lawlor: Seven years.

Mr. David Dillon: Yes, and a decision was made recently to proceed with it, which will

happen in a shorter time frame.

Senator Michael Mullins: We need to use our imagination and make it easier for people

to make the transition from social welfare to work and from work to social welfare. People

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offered short term irregular work will not take it because it is too cumbersome for them to

resume signing on and they will lose benefits.

We should also examine the aggregation of hours as distinct from the number of days that

people work. A person can sign on if they work all of their hours in one or two days.

However, if they work for two hours a day for five days they are barred from signing on.

The system is unequal and unfair.

Vice Chairman: Senator Mullins touched on the move from welfare to work. In this

regard, let me refer to the poverty trap of social welfare, the cage that protects but does not

set one free. How can we make it easier for people to move from welfare to work? Some

93,000 casual part-time workers in receipt of the jobseeker‟s allowance want to work full-

time but perhaps do not understand or have the necessary information on the entitlements

they would retain if they did so. Could the delegates comment on that?

Mr. David Dillon: Not all of the 83,000 are in the poverty trap, by any means.

Vice Chairman: I am not saying they are.

Mr. David Dillon: The issue associated with the poverty trap revolves around the issue of

replacement rates. The vast majority on the live register would be better off working at the

national minimum wage. On two thirds of the average industrial wage, they would be

better off again. On the average industrial wage, they would be significantly better off in

most cases. There are a few outliers, which we discussed in September because that was

the topic of the presentation. I refer to those in receipt of rent allowance and those with

larger families. Family income supplement kicks in when one works above a certain

number of hours, and that addresses, for some but not all people, many of the poverty trap

issues that arise. We recognise that probably fewer than 5% on the live register face

significant issues in regard to the poverty trap. Others face the issue of hours versus days,

which is trapping people. We are seeking to address that in the implementation of the

review we discussed earlier.

With regard to income maintenance and social protection, there will always be a balance to

be struck between retaining the incentive to work through having a certain level of social

welfare that one does not exceed and recognising poverty through poverty measures and

thresholds, including the 60% threshold.

The financial incentive is not the only issue that arises for those who face the poverty trap

because issues arise over education, skills, training, etc. If they were addressed, it would

allow people to enter the workforce and progress upwards.

Deputy Anthony Lawlor: Mr. Dillon stated one reason for the delay in implementing the

report from 2007 was the comments from the social partners. Can we have copies of those

comments?

Mr. David Dillon: Yes; they date from 2007.

Deputy Anthony Lawlor: I have met a number of the social partners. Others have not

responded to me at all. Could the comments be supplied to me in the next week?

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Mr. David Dillon: Yes.

Vice Chairman: I thank the witnesses for attending, for being so frank and giving us such

valuable information. I appreciate it. I thank Ms Stack and Ms Gleeson in particular for

making the presentations.

The joint committee adjourned at 11.20 a.m. until 9.30 a.m. on Wednesday, 28 March

2012.

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Appendix G

Questions No: 16 & 102 Ref No: 20628-12

20672-12

To ask the Minister for Social Protection if she will explain her rationale for changing the

jobseeker's payment from a six day week to over a five day a week in view of the fact that

it will act as a disincentive to work; and if she will make a statement on the matter.

- Richard Boyd Barrett.

For ORAL answer on Wednesday, 25th April, 2012.

To ask the Minister for Social Protection the reasons, as effective from July 2012, the level

of payment for a part time worker in receipt of jobseeker's benefit will be based on a five

day week rather than the current six day week, but that this new rule will not apply to part

time workers in receipt of jobseeker's allowance whose payment will remain based on six

days; and if she will make a statement on the matter.

- Anthony Lawlor.

For WRITTEN answer on Wednesday, 25th April, 2012.

R E P L Y

I propose to take Questions 16 & 102 together.

In the last four years the numbers in receipt of a jobseeker‟s payment who are also

working on a part-time or casual basis has increased by almost 200%. At the end of March

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2012 there were some 84,118 people in this situation on the Live Register and some

41,008 of these were claiming jobseeker‟s benefit.

In line with other Budget measures the effect of this measure will not impact on any

person whose sole income is from social welfare. It will only apply to those who have

earned additional income from working some days during the week.

The effect of this measure will be to reduce the contribution from jobseeker‟s benefit to the

weekly amount of total income and help towards a reduction in the reliance on the welfare

system among those who currently avail of a mix of welfare and earned income. As a

savings measure, the change will reduce costs within the jobseeker‟s benefit scheme but

the scheme will continue to deliver incentives towards additional employment for part-

time and casual workers. It is important to note that the measure applies to jobseeker‟s

benefit only and that recipients of jobseeker‟s benefit may opt for jobseeker‟s allowance,

which is subject to a means test.

Entitlement to jobseeker‟s benefit is based, inter alia, on the claimant being unemployed

for three days in any period of six days with benefit being paid at a flat rate, irrespective of

earnings. Jobseeker‟s allowance is also based on satisfaction of „three in six‟ criteria but

entitlement is thereafter determined by reference to weekly means. Therefore the

jobseeker‟s allowance scheme takes account of the earnings of part-time and casual

workers, via means reduction in respect of any day in which they have earnings from

employment.

ENDS