28th September 2018
Minister requested review against the backdrop of a changing economy and labour market. Last major review took place in 2012.
Findings to inform update of Ireland’s employment permits system.
Exercise undertaken at Minister’s request by an Inter-Departmental Group, chaired by the Department of Enterprise, Business and Innovation.
The Minister for Business, Enterprise and Innovation, Heather Humphreys TD, has today published a review of Ireland’s economic migration policy, which underpins the employment permits system. Earlier this year, in the context of a changing economy and labour market, Minister Humphreys asked her Department to carry out the first major review of this type since 2012.
Launching the review, Minister Humphreys said:
“I requested this review because our economy and labour market have changed fundamentally in recent years and I wanted to ensure that our policy remains fit for purpose.
“First and foremost, it confirms that the current employment permits system is robust and has served the country well in recent years, allowing us to focus on attracting skills critical to business. It also tells us that now, in the context of strong employment growth, new pressures are emerging that need to be addressed and, in this regard, I am satisfied that some adjustments are needed.
“On the one hand, we will continue to ensure that Ireland can attract highly skilled foreign workers, while on the other hand, we will allow the system to respond to proven labour shortages that arise from time to time in lower skilled occupations.”
An overarching set of Guiding Principles have been set down that provide a clear framework for the State’s employment permit system. This framework allows for decisions to be made and actions to be taken in a robust, coherent and consistent manner. Specifically, it provides for a system with the flexibilities required to ensure it remains supportive of the Irish labour market at all stages of the economic cycle.
In this regard, Minister Humphreys highlighted:
“It is crucial that we are cognisant of the fact that we still have 209,900 people on the Live Register in Ireland and 16.8 million unemployed in the EU28.”
Key recommendations deriving from the Review include:
- Changes to the current twice-yearly review of the Highly Skilled and Ineligible Employment Lists - which deal with labour market access for non-EEA workers - to make the system more responsive in real-time. While the twice-yearly system will still operate, sectors experiencing severe labour shortages will be able to submit a business case for consideration via their line Department as they arise. A temporary scheme of this nature was piloted for the agri-food sector earlier this year.
- Introduction of a Seasonal Employment Permit to facilitate certain categories of short-term workers.
- A review of salary thresholds and other criteria for the various employment permit types to ensure a good fit with changing skills and labour market needs with minimal disruption to the labour market.
- Changes to the current legislation to balance robust regulation with flexibility.
- A modernisation and extension of the Labour Market Needs Test.
- Adjusted requirements for balanced hiring practices (the’50:50 Rule’) to meet a broader range of enterprise needs.
- A new system of Cross-Departmental oversight. This will be achieved by re-convening the high-level Inter-Departmental Group under revised Terms of Reference, to oversee the implementation of the Report’s recommendations, to monitor the ongoing alignment of the employment permits regime with the needs of the labour market and to report to the Minister of Business, Enterprise and Innovation on a regular basis.
Minister Humphreys continued:
“I am very mindful that our economic migration system should be capable of meeting our needs whether in times of growth, like now, or otherwise. The recommendations include structural adjustments to the system, which will allow us to respond to a greater range of employment circumstance. This will enable us to be more flexible and keep pace with evolving enterprise requirements over time.”
A number of recommendations made in the report can be implemented in the short to medium term, and these will help alleviate points of constriction in either the labour market or the processing system. These include changes to the process of reviewing the occupational lists, remuneration thresholds, the Labour Market Needs Test and the 50:50 rule, and certain other process and administrative changes.
In the longer term, amendments to primary legislation will be brought forward in order to facilitate the creation of a new seasonal permit type, as well as some adjustments to the criteria built into current legislation. These adjustments include the Labour Market Needs Test as currently constituted; and increasing the Department of Employment Affairs and Social Protection’s engagement in this process.
The Minister concluded by thanking members of the Inter-Departmental Group for their comprehensive work on the review.
Notes for the Editor
Review of Ireland’s Economic Migration Policy
1. New Pilot Scheme for Workers from Outside the EEA in 2018
Earlier this year, in advance of the completion of the Review, Minister Humphreys announced a pilot scheme to address immediate labour shortages in certain occupations in the agricultural sectors. This included the following allocation of employment permits for workers from outside the EEA:
- 500 permits for horticulture workers, 250 for meat processing operatives and 50 for dairy farm assistants in May 2018.
- An additional 500 permits for meat processing operatives in August 2018.
The pilot scheme was announced by the Minister following the consideration of an evidence-based business case submitted by the Department of Agriculture, Food and the Marine.
To date, a total of 276 permits have issued for Meat Processing Operatives, Dairy Farm Assistants and Horticultural workers.
Changes to the employment permit regime will continue to be evidence based, with a clear role for the relevant sectoral lead Government Department to present an evidence-based business case for consideration. The pilot scheme for agricultural workers is a good example of how this can work. A business case template has been developed to assist Government Departments in this regard.
2. Background to the Review
Earlier this year, in recognition of the changing economy and labour market as the country moves clearly and strongly out of the downturn, Minister Humphreys asked her Department to review the economic migration policies underpinning the current employment permits system. The last major review of the employment permit system took place in 2012, when unemployment was high, yet certain key skills were in short supply.
Now, six years later and in the context of continuous economic and employment growth, it was timely to undertake this review to ensure that our policies governing the employment permit system are fully supportive of Ireland’s emerging labour market needs, be they skills or labour shortages in certain sectors.
An Inter-Departmental Group (IDG) chaired by the Department of Enterprise, Business and Innovation, with a membership drawn from senior officials of key Government Departments, was established to oversee the review.
The overall objective of this current review was to re-visit the policy rationale for the employment permit system where the economy is improving and the labour market is tightening. A public consultation, wide stakeholder engagement, extensive desk research and an international benchmarking exercise informed the work of the Group.
Officials from the following Government Departments participated in the IDG:
- Department of Business, Enterprise and Innovation
- Department of Justice and Equality
- Department of Agriculture Food and the Marine
- Department of Education and Skills
- Department of Health
- Department of Housing, Planning and Local Government
- Department of Public Expenditure and Reform
- Department of Transport, Tourism and Sport
- Department of Employment Affairs and Social Protection
- Solas (The Further Education and Training Authority)
A key undertaking for the IDG was to develop a clear economic migration policy framework which would reconcile short term and longer-term policy objectives over the coming years. In building that necessarily dynamic and flexible economic migration policy, the IDG has set out an overarching objective for the State’s employment permit system:
“The State’s employment permit system should help meet, in the short to medium term the demand for skills and labour in the Irish economy without disrupting the Irish labour market.”
To provide the context and framework within which decisions can be made and to provide a rationale for actions taken, the IDG then agreed on an overarching set of guiding principles for the employment permits regime:
- Principle 1: EEA preference
- Principle 2: Labour market responsiveness
- Principle 3: Skills shortage
- Principle 4: Balanced approach to innovation & labour market
- Principle 5: Net contributor
- Principle 6: Employment rights
- Principle 7: Legislative framework & process
In respect of each of the guiding principles, the IDG made a wide range of recommendations for implementation in the short/medium term and longer term, some of which can be implemented within the current legal framework with others requiring amending the current Employment Permits Acts going forward. An Action Plan is being finalised to drive these recommendations which will continue to be overseen by the IDG.
3. Background to the State’s Economy Migration Policy
The Irish State’s general policy is to promote the sourcing of labour and skills needs from within the workforce of Ireland, the European Union and other EEA states. Policy in relation to applications for employment permits remains focused on facilitating the recruitment from outside the EEA of highly skilled personnel, where the requisite skills cannot be met by normal recruitment or by training. Employment permit policy is part of the response to addressing skills deficits which exist and are likely to continue into the medium term, but it is not intended over the longer term to act as a substitute for meeting the challenge of up-skilling the State’s resident workforce, with an emphasis on the process of lifelong learning, and on maximising the potential of EEA nationals to fill our skills deficits.
The employment permits system is managed in part through the operation of the highly skilled and ineligible lists for the purpose of grant of employment permits.
- Highly skilled jobs are professional positions in medicine, ICT, sciences, finance and business. Special “fast-track” rules apply e.g. family can join the permit holder immediately, permanent residency in available after two years.
- Ineligible jobs are generally lower skilled occupations eg home care and hospitality. There is evidence that there are more than enough Irish/EEA workers to fill such vacancies.
- Every other job in the labour market, where an employer cannot find a worker, may be eligible for an employment permit. The employer has to do a Labour Market Needs Test (i.e. advertise the job for two weeks). If no-one suitable applies for the job, the employer is free to apply for an employment permit.
4. Employment Permit Statistics (at September 1st):
- 11,238 applications for employment permits have been received so far in 2018, an increase of 29% (8,690) as at the same time in 2017.
- 8,043 permits have issued to date an increase of 6% over same time 2017. Of these permits issued 3,580 have been for Critical Skills Employment Permits and 2,466 have been for ICT permits.
The Department of Business, Enterprise and Innovation (DBEI) plays a key role in implementing the Government’s policies of stimulating the productive capacity of the economy and creating an environment which supports job creation and maintenance. The Department also has a remit to promote fair competition in the marketplace, protect consumers and safeguard workers.
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