Temporary wage-subsidy scheme is essential - Patricia King - Irish Times letter
31 Mar 2020
Temporary wage-subsidy scheme is essential
Sir, – Last Friday the Oireachtas passed all stages of the Emergency Measures in the Public Interest (Covid-19) Bill 2020.
The trade union movement has been to the fore in advocating for the introduction of a temporary wage-subsidy scheme. It has also been supported by the main employer groups. Since its publication on Thursday, a number of lawyers have expressed the view that this legislation, in particular part seven, which provides for such a scheme, will be interpreted and applied in a way that undermines the object that the enactment is intended to achieve. There is no basis in law or in logic for such a proposition.
Legislation must always be interpreted and applied in a manner consistent with the intention of the Oireachtas. While the primary approach must always be to give the words and phrases used in the legislation their ordinary and natural meaning, regard must always be had to the underlying rationale for the legislation, as ascertained from a reading of the Act as a whole. This has been emphasised time and again by the courts.
The plain intention of this proposed legislation is to assist employers to avoid insolvency and to protect employment during the emergency period. It is bordering on the absurd to suggest that it could be applied in a manner that produces the opposite result.
It is true to say that the Bill is lacking in the type of detail that might otherwise be expected in legislation such as this. That, however, is understandable having regard to the context in which it was drafted and has to be enacted. This is offset by a significant provision at section 27(3), which authorises the Revenue Commissioners to fill in the detail of how it is to be established if an employer qualifies for the relief provided by the Bill.
It is suggested that the guidelines will have no legal standing. That proposition ignores the fact that the Revenue Commissioners are mandated by the Bill to issue guidelines and that section 27(3) expressly provides that those guidelines are to be relied upon in determining eligibility for the wage subsidy.
It is also true to say that the provision relating to the subsidising of net pay will produce different results for different individuals, depending on their normal deductions, etc. But that is inevitable given the general scheme of the legislation.
The contention that this scheme should be an arrangement whereby all employers would have 70 per cent of their wage bill subsidised by the exchequer, without any limitation, on a mere declaration by the employer of a reasonable belief that it is necessary, is wholly impractical and open to abuse. Moreover, such an arrangement could be challenged on constitutional grounds in that it could be seen as an abrogation by the State to properly safeguard public funds and ensure that they are used for the purposes intended.
The intention of the proposed legislation is clear. It is a non-repayable contribution from government in recognition of extraordinary circumstances. Availing of the scheme is not increasing the liabilities of the company. It contains, as it must, safeguards to ensure that public funds are used for the purpose intended which are not unduly burdensome and can be further augmented by statutory guidelines to be issued by the Revenue Commissioners.
It seems to be highly irresponsible, in present circumstances, for anyone to advocate that employers would not avail of this scheme. – Yours, etc,
of Trade Unions,