The Minister for Employment Affairs and Social Protection Regina Doherty will bring a memo to Cabinet tomorrow regarding improving protection for workers trapped in bogus self-employment.
Bogus or false self-employment arises when an employer wrongly forces a worker to register as self-employed when they are in reality direct employees.
By doing so, the employer makes significant savings on PRSI contributions. However, without those contributions, the falsely categorised employee can lose out on important legal protections and social welfare entitlements.
The Irish Congress of Trade Unions has estimated that the practice has deprived the exchequer of hundreds of millions of euro in PRSI contributions.
However some observers argue that the situation may be even worse now, as more and more workers are categorised as self-employed within the rising so-called "gig economy".
The DEASP Scope section currently adjudicates on the employment status of the worker where disputes arise.
Under Ms Doherty's proposals, reported in today's Irish Times, a new stand-alone body would be "beefed-up" to investigate claims of bogus self-employment more efficiently.
As unemployment falls, 200 civil servants currently employed as social welfare inspectors would be retrained to carry out investigations of employers.
The proposed new body would have the power to adjudicate on groups of workers on identical terms and conditions collectively, rather than on an individual basis as at present.
A 2007 Code of Practice on bogus self-employment is currently being reviewed by an inter-departmental group and would be placed on a statutory footing.
The minister is also proposing enhanced protections against victimisation for making a complaint against an employer.
Ms Doherty's move comes as a similar Bill - the Protection of Employment (Measures to Counter False Self-Employment) Bill 2018 - proposed by Labour Senator Ged Nash goes to Committee stage in the Seanad on Wednesday evening.
Among its provisions, Senator Nash wants to see tougher punishments for employers engaging in bogus self-employment, including treating their failure to pay proper PRSI contributions as a form of tax evasion, and subjecting them to the broad range of penalties applicable to tax cheats.
However, it is understood that the Revenue Commissioners have advised that the penalty provisions in the Senator's bill raise significant legal and procedural issues and would be very difficult to enforce.
