Part-time staff 'can't afford' to work more hours
Published 26/09/2010 | 05:00
Employers have slammed the Government over social welfare rules which mean that part-time workers are better off if they don't increase their working hours.
They make more money by working only a three-day week and then making up the balance with social welfare payments.
It means that the State is losing out on PAYE revenue, while at the same time paying out millions in social welfare.
Marissa Carter, 27, is the founder of 'Carter Beauty' in Blackrock, Dublin. She set up business in 2007 and believes that neither employers nor staff are getting a good deal.
She explained: "I began interviewing for two new full-time employees. I gathered from the women I interviewed that they could only work three days a week if they wished to retain their social welfare benefits, including lone-parent and rent allowance. If they work more than 20 hours, they risk losing all their benefits."
She added: "Fundamentally, the system really isn't benefiting anyone."
Marissa said many businesses were having to employ two people to do a one-person job.
"The impact of this has been an increased cost base. The impact of these fees being doubled is highly significant when businesses are trying to reduce variable overheads in order that we can offer competitive pricing.
"The most disruptive effect is that it creates a very inflexible staff culture. If someone calls in sick an employee is needed to work extra hours to cover, they simply won't do it for fear of the impact on their social welfare" she explained.
Another employer, who closed his business due to the downturn, recently tried to re-employ his old workforce when he restarted his business -- but some of them told him they were better off on welfare and mortgage supplements and so wouldn't return to work.
A spokesperson from the Department of Social Protection said: "The department operates a control measure, whereby a percentage of employers of part-time/casual workers are contacted periodically and asked to sign a declaration, confirming details of the days worked by a casual employee over a period of up to seven weeks.
"The employer is also asked if they have full-time work available for the person or if the person has been offered full-time work. If an employer has offered full-time work to an employee and this offer has been refused, the employer should contact the department with the details."
But a 29-year-old worker who spoke to the Sunday Independent confirmed that she was better off part-time.
She receives €221 through the lone-parent allowance and believes there is no incentive for her to work full-time. Taken together, her lone-parent and rent allowances are equivalent to a basic wage.
"I can't work more than 20 hours a week and I have told my employer this as the rent will go up otherwise. There is no incentive for me to go back to working 40 hours a week, so what's the point?"
The Labour Party's finance spokeswoman Joan Burton believes that the Government will have to focus on a number of measures which will create a positive environment for people returning to work.
She said: "In the past, we had a series of schemes, ranging from back-to-work schemes to giving parents the right to work whilst still retaining benefits. The social welfare system is still geared for structures when we had full employment."
Lara Casey of Lara Boutique in Dublin has seen how this dilemma affects retail outlets.
"Many of their staff are restricted to working up to 20 hours a week, not 21 or 22, but 20. There is a cut-off point and they don't get the dole otherwise" she said.
Another businesswoman told a similar story . She said many of her staff refused to work five minutes' overtime as they feared it would push them over the limit.
"It's a huge bugbear of mine," she said. "My staff are all paid well above the minimum wage, but as they only work from 9am until 1pm each day, the amount of income supplement the Government gives them is more beneficial to them.
"As they are working part-time, they don't have to pay tax, PRSI or an income levy. They are entitled to a medical card because their income is under a certain level; they get children's allowance, unmarried mothers' allowance and housing allowance. It is not to their benefit to work full-time."