From Department of Enterprise, Trade and Employment
By: Minister for Enterprise, Trade and Employment;
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The National University of Ireland and the International Labour Organisation Edward Phelan Lecture 2022 at the Royal College of Physicians of Ireland
The Future of Work in a Post-COVID World
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Chancellor, Director-General, colleagues, friends,
Good evening.
I’m honoured to give the Edward Phelan Lecture this year.
I want to start by welcoming Guy Ryder, Director General of the ILO, who has travelled from Geneva. Guy, you have led the ILO through some of the most turbulent of times, through the pandemic and now the war in Ukraine. You should be proud that during your time in office the ILO adapted so quickly to the huge challenges it faced.
I also want to acknowledge the presence of Michael Gaffey, Permanent Representative to the UN Office at Geneva. Thank you for your work on behalf of the Irish Government.
The ILO’s founding mandate, that social justice is essential to universal and lasting peace, is as relevant now as it ever was.
The 2019 ILO Centenary Declaration for the Future of Work was a reaffirmation of the relevance and importance of the ILO’s mandate, and a call to action for its constituents for a future of work with a human-centred lens.
As you may know, Ireland has a rich history with the ILO. It was the first international organisation that Ireland, as a new State, joined in 1923.
It was a great source of pride for us when Ireland became a full member of the Governing Body for the first time in 2017 and our Titulaire membership was a time of committed engagement between our country and your Organisation.
Also, I would also like to thank employer and worker representatives for your consistent engagement and support during Ireland’s Titulaire membership.
We are particularly proud of Irish-born Edward Phelan’s role as architect of the ILO’s unique tripartite structure and his influence in shaping the ILO both at the time of its foundation in 1919, and again, in 1944, through the powerful words of the Declaration of Philadelphia which he drafted almost single handedly.
Edward Phelan was born in Waterford in 1888, studied in Liverpool and went on to work for the British Civil Service. My mother’s path was not dissimilar, moving from Waterford to London to train as a nurse.
It was there that my mother met a young Indian man who moved to England with fifty pounds in his pocket.
My parents always taught us about ambition, hard-work and community. We were brought up to believe that you were only entitled to the things you worked for. And, in my political career, I’ve always sought to make it easier for people to pursue their ambitions and make sure that work is rewarded and respected, that it pays and that it is secure.
To turn to the title of the lecture – ‘The Future of Work in a Post-COVID World’ – the first thing I would say is that we are not yet in a post-COVID world. We may never be. This virus could be with us for eternity. But we are in a very different phase of the pandemic.
Acting together, Ireland has handled the pandemic relatively well, recording one of the lowest excess mortality rates in Europe and one of the highest vaccination rates.
I would like to thank employer and employee representative bodies for your role in that national effort. I know it made a big difference.
The pandemic has changed the world of work and has accelerated some changes that were already underway.
The global battle for talent is fiercer than ever before and talent is more mobile. Employers are struggling to recruit and retain staff.
Digitalisation, remote working and the green economy are all moving forward at a swift pace.
The war in Ukraine has added further uncertainties and challenges with the largest movement of people in Europe in decades.
The Russian invasion of Ukraine has highlighted the inherent vulnerability of allowing our economies become dependent on fossil fuels, especially when limited supplies are controlled by a small number of non-democratic states that do not share our values.
While weaning ourselves off coal, oil and gas is a global challenge, it also presents incredible opportunities, specifically in the area of new energy sources such as electricity generated by offshore wind, and green hydrogen – the home-produced fuel of the future that can replace natural gas, fire our power stations and heavy industries and fuel our trucks and ships.
By ensuring we have a plentiful and sustainable energy supply, employers, multinationals and industry will feel more confident in investing and creating jobs.
A change to a net zero economy and society can only be achieved through a transition that will open up new employment and enterprise opportunities. This is the Just Transition in its truest form.
In order to maximise these opportunities, continuous development of our workforce is required through reskilling and lifelong learning.
We need to be alive to green transition employment opportunities and link them to current training provision, setting out where new training and education programmes are needed.
It is critically important to enhance the skills and training advice to workers in declining sectors before they become unemployed, enabling them to take these new opportunities.
I believe employment activation and the creation of supported job placements will be important in providing opportunities for people at the margins to become part of the transition to the new economy.
As with the advent of new technologies throughout history, digitalisation will bring profound disruption to existing ways of doing things.
Workers must be supported in developing and learning new skills.
Earlier this year, I launched a new Digital Strategy for Ireland.
Under this plan, we want 90% of SMEs to have achieved basic digital intensity by 2030 and we will help to realise that ambition through a multi-annual Digital Transition Fund for business.
All Irish households and businesses should be covered by a Gigabit network no later than 2028 due to the National Broadband Plan and private telco investment and we want to increase dramatically the number of graduates with higher-level digital skills.
Artificial intelligence is transforming the world of work and accelerating the pace of skills change.
The embedding of digital skills across the labour force will be integral to the effective use of AI technology. Lifelong learning and widespread digital literacy have never been more important.
If we respond quickly to this need for skills development, then great benefits in job satisfaction, competitiveness and productivity can be achieved.
A slow response could see the digital divide widening, and we must avoid this.
The government wants to reimagine the role of apprenticeships. Our ambition is to grow new apprentice registration to 10,000 per annum by 2025. We are on track to reach that target with registrations in 2021 the highest they have been since 2007.
The pandemic showed us what is possible; now we need to make sure that remote, flexible and hybrid working becomes an established feature of our working lives.
In practice, employers and employees are agreeing to arrangements that suit both sides. In the vast majority of workplaces, no legislation is required to make this happen.
However, with the right to request remote working legislation, we will, for the first time, provide a legal framework around which requesting, approving or refusing a request for remote work can be based. It will also provide legal clarity to employers on their obligations for dealing with such requests.
While there are clear advantages to working remotely, a potential downside is the expectation that workers are always ‘switched on’. We need to reduce the intrusion of work-related digital devices after working hours in order to balance workers’ professional and personal lives.
This time last year I introduced a legally admissible Code of Practice which applies to all types of employment, whether you are working remotely or not. I have written to the Workplace Relations Commission to see how the Code is working, 1 year on from its publication.
The pandemic has underscored the importance of occupational health and safety for workers’ lives and wellbeing.
Ireland strongly supports ILO efforts to have Occupational Safety and Health recognised as a fundamental principle and right at work.
The acceleration of remote and hybrid working meant that people working from home were exposed to risks due to the blurring of boundaries between work and private life, lack of social interaction, ill-adapted working environments and an increased continuous use of technology.
Language is important.
We are moving away from the traditional “workplace”.
Many workplaces already exist only in the digital world and the employer-employee relationship can be difficult to define. This increase in diversification of workplaces and work raises challenges for workers, regulators and others charged with protecting employer duties and workers’ rights and safety.
I believe the tripartite approach involving the government, employers and unions, was very productive during the response to the pandemic.
For example, the Work Safely Protocol took account of the reality of how businesses operate and of how workers work. It was updated frequently, and without rancour, as we moved through the pandemic and I would like to thank all involved for your work.
I want to briefly mention ILO Convention C190 to eliminate violence and harassment in the world of work.
Ireland has very strong protections in law to combat violence and harassment in the world of work and has ratified the Council of Europe Convention on preventing and combating violence against women and domestic violence.
Director General, you launched a global campaign in 2021 for the ratification of the Convention. Ireland only ratifies conventions when we are satisfied that our legislation is robust, so officials in the Department of Enterprise, Trade and Employment are currently engaged in this work. We will undertake a stakeholder consultation in the coming months and aim to ratify it later this year.
You’ll be familiar with the concept of the ‘Great Resignation’.
The US academic Anthony Klotz first proposed it last year and identified 4 causes:
I’m not sure we are in fact witnessing a Great Resignation. There is some evidence it is happening, but it might also be exaggerated.
Ireland’s employment figures indicate that a record number of people are in employment, surpassing pre-pandemic levels. This is an incredible achievement considering we lost over 300,000 jobs during the last significant hit to our economy. If anything, the possibilities of remote work have opened up new opportunities to take up work. And our latest employment data shows that female participation rates have hit record levels.
McKinsey recently surveyed 600 workers in Ireland, Australia, Canada, New Zealand, Spain, the UK and the US who had voluntarily left a job without another one in hand. 44% of them said that have little to no interest in returning to traditional jobs in the next 6 months.
If the Great Resignation isn’t happening in Ireland, I certainly think people are re-evaluating their careers and their lives as a result of the pandemic. Perhaps, it will prove to be more a ‘Great Reset’.
The battle for talent in a globalised economy will become even more important in the coming years. Ukraine, inflation, labour shortages and a range of other factors are coming together to make that battle even more intense.
Employers will struggle to recruit and retain staff. Ireland will have to make sure it is ahead of the curve, offering better terms and conditions than elsewhere, to continue growing employment.
So, I believe better pay, terms and conditions make sense for everyone – for workers and families, for jobs, business and investment and for the public finances.
I also believe that the most important workers’ right is the right to work, so we need to guard against any policies that might reduce employment levels.
As Minister for Enterprise, Trade and Employment, I am establishing 5 new workers’ rights this year.
From now on, Ireland will have an extra public holiday at the start of February to mark Imbolc/St Brigid’s day. This is the first Irish public holiday named after a woman and the creation of a tenth public holiday will bring Ireland more into line with the European average.
Later this year, employees in Ireland will, for the first time, be entitled to statutory sick pay from their employers. It’s my intention that this reform should be linked to improvements in Illness Benefit so that it is more properly pay-related in terms of benefits.
As I mentioned earlier, we will provide a legal framework around which requesting, approving or refusing a request for remote work can be based. This legislation has provoked much debate and I’m committed to strengthening it in the coming months on the basis of further input from stakeholders.
Last week, I signed a new law to ensure that employees don’t lose out on redundancy payments if they were laid off as a consequence of public health restrictions.
And finally, we will ensure workers’ tips are protected and provide clarity on how service charges are dealt with.
In addition to these 5 new workers’ rights, I have established a high-level group under the auspices of the Labour Employer Economic Forum (LEEF) to examine the industrial relations landscape in Ireland.
In the light of this, and international moves to look more closely at how employers and trade unions engage on matters of mutual interest, it’s timely to review collective bargaining and the industrial relations landscape.
I think this will only work if we have agreement among employers and the unions. I expect to bring a final report to Government later this year.
Colleagues, I’d like to spend a few minutes to talk about another way in which the government plans to strengthen workers’ rights and raise living standards – a living wage.
Last year, I asked the Low Pay Commission to examine and make recommendations on the best approach to establishing a living wage in Ireland. I have just received that report.
I’d like to thank the researchers from NUI Maynooth – a constituent university of the National University of Ireland which is closely involved in this evening’s event – whose study fed into the Commission’s report.
I also want to acknowledge the work of many others, including Eurofound, the UK Low Pay Commission, IBEC, ICTU, ISME, the Living Wage Technical Group, the Vincentian Partnership for Social Justice, the CSO, and of course, my own officials in the Department of Enterprise, Trade and Employment.
One of the first things I learned on reading the report is that the concept of a living wage can be traced back to Aristotle in Ancient Greece.
Still, it is a relatively novel idea, understood differently in different parts of the world.
In this respect, the Irish Government will be among the early movers in adopting a national, mandatory living wage. I intend to honour the Programme for Government commitment that we should do so.
Opinion is divided on how to calculate it. I see merit in the basket of goods and services approach – that each year we would decide what is needed to achieve an agreed standard of living – but I also think that approach would be subjective. We would have inconclusive debates about what should be in the basket and how much should be in it.
An alternative approach is setting the living wage as a percentage of the median wage. This approach is simpler and provides certainty.
I expect to bring proposals to Government on how we can adopt a living wage before the summer recess.
I’m very conscious that businesses in Ireland have endured a pandemic for 2 years and are now facing increased costs due to the war in Ukraine. The government is adding to those costs by increasing wages and protections.
That’s why we need to make sure these reforms are phased in appropriately.
In the UK, a targeted future living wage rate was set 5 years in advance. This is something we could do in Ireland. Companies would have the time to plan, prepare and adjust.
A living wage will be an important milestone for workers in Ireland, building on the series of actions that have improved social protections for workers and the self-employed over the last 5 years, including the introduction of paternity benefit, parental leave benefit, enhanced maternity benefit, the reintroduction of treatment benefit and the extension of social insurance benefits to the self-employed.
Workers have been through a lot in the last 2 years, but so have thousands of small and medium enterprises. SMEs are the backbone of the economy and need to be nurtured.
Ireland has become a wealthy country relatively recently, and we must identify, protect and improve the things that we’re good at.
If we are to prosper, we need to regain and improve our competitiveness. It’s not about keeping wages low or loosening terms and conditions.
We must be creative about how to preserve Ireland’s reputation as a world-class place to do business. As always, it will be about talent, free trade and track record as well as tax, but it must be about other things too like security and infrastructure and liveability.
Competitiveness means providing the basic public infrastructure expected in advanced economies, such as energy, housing, water and transport. I acknowledge the real shortcomings in these areas. We are determined to change that through the National Development Plan – Project Ireland 2040.
Governments across the world are grappling with how to deal with the inflation and cost of living crisis being experienced by so many of our citizens.
For the first time in many years, real living standards could fall this year if prices rise faster than disposable incomes. It’s certainly true for very many households already. It’s something the government is conscious of and concerned about.
We have provided over €1 billion in relief already to ease the pain, but, as a government, we can do more by helping to reduce some of the underlying high costs that Irish people endure.
I believe we need a comprehensive anti-inflation strategy to reduce the cost of living.
Central Banks must do their bit, and I believe it would be better if they reigned in quantitative easing at an appropriate pace, rather than increasing interest rates at this time.
Domestically, I believe it should have 6 elements:
I can’t understand why the Opposition parties continue to oppose the indexation of tax bands. The case for it is never stronger than now given inflation. Not to do so puts the entire burden on the employer to provide pay rises and will leave some workers with nothing if their employer cannot afford to do so.
Next year, increased subsidies should be used to reduce costs considerably for parents. This will increase disposable family incomes and make it more attractive for parents to return to the labour market thus helping to fill vacant positions and moderate wage inflation.
We should also reduce charges for healthcare, the cost of public transport and higher education. Other Europeans simply do not have to pay so much to see their doctor, attend a hospital or buy medicines.
I understand the need to get the balance right between responding to these cost pressures and avoiding adding to demand in the economy and making our challenges harder.
So, this is why all this will have to be done within the existing fiscal and budgetary framework agreed by Government, which involves ensuring that we continue to reduce the deficit, stay ‘with the pack’ in terms of the deficit level among our peer countries and ensure that public spending does not rise faster than the economy is growing in the absence of new revenues.
I do believe there should be pay rises and indeed further increases in pensions and welfare. I do not say that lightly. I say that as somebody who signed off on a 3% increase in the minimum wage only a few months ago, a member of government that agreed a pay deal with public servants and the head of a department that signs off on sectoral pay rises in the private sector.
I also believe that it is a mistake to think that pay rises will solve the problem of inflation. Pay rises won’t bring down the price of anything. And pay rises could actually contribute to inflation and make the situation worse. That is why we have to look at these things in the round.
Tomorrow we will meet with some of the people in this room in the Labour Employer Economic Forum (LEEF). I know this will be firmly on the agenda.
It makes sense for Government, employers and unions to engage on this issue on a tripartite basis.
During the pandemic, we saw how effective we can be as a country – everyone acting together in pursuit of common goals.
A tripartite approach was key to us turning the tide on our economic history in the late 1980s with the Programme for National Recovery.
This need not be exceptional. We must try to hold on to the positive elements of that exceptional national effort as we face another turbulent year ahead.
As partners, we need to build our economies and society and prepare for a new world that is greener, more digital, more resilient and fit for the future.
We must do this at home and on an international basis.
I will leave you with a quote borrowed from the Rev. Martin Luther King:
No work is insignificant. All labour that uplifts humanity has dignity and importance and should be undertaken with painstaking excellence.
Thank you.