It is apparent even to the casual observer that a range of structural reforms are long overdue, in order to remove barriers to employment and disincentives to work.
Finally, the Government has set up a review of statutory wage setting mechanisms which is to address these anachronisms and report within a 3 month timeframe.
Our conclusion is clear. The Irish tourism industry is operating in an intensely competitive international marketplace, which is characterised by a high degree of price sensitivity. If the industry is to return to growth and achieve its rich economic potential, unwarranted obstacles to the restoration of our competitiveness must be removed. One such obstacle is the Joint Labour Committee system which is setting minimum wage rates, which are now far higher than the National Minimum Wage rate, in the most labour-intensive sectors of the tourism industry.
The Joint Labour Committees are an anachronism, established at a time when there was no National Minimum Wage and little protection of employee rights. These circumstances no longer obtain. We have a National Minimum Wage which is already high by EU standards. In fact, as it stands the National Minimum Wage is the fifth highest in the EU. It’s incredible to think it is a stated objective of both parties which are likely to form the next Government, that they are to increase the minimum wage again. We could all really do with a whiff of whatever the stuff is that they are inhaling!!
It is ITIC’s belief that good labour legislation is already in place and that no industry can afford the consequences of higher labour costs. The National Minimum Wage should be the only statutory minimum wage. We therefore recommend that the Joint Labour Committees and associated system of Employment Regulation Orders be abolished.
CLICK HERE to read ITIC’s full submission to the Review Group.
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March 3rd 2011