Meat processing sector disputes it is highly profitable, based on low pay

Meat industry representatives have taken issue with suggstions that their sector is highly profitable and say it is unfair to characterise it as being based on low pay for workers.

Philip Carroll from Meat Industry Ireland told the Oireachtas joint committee on enterprise and employment on Tuesday it was a low-margin sector.

He said there was a narrative that the meat processing sector was highly profitable. He said it was a sector that had a high turnover but “that doesn’t it make it profitable”.

Representatives of Meat Industry Ireland and the Migrant Rights Centre Ireland (MRCI) appeared before the Oireachtas Joint Committee on Enterprise, Trade and Employment on Tuesday on proposed Government reforms to the work permit system.

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The proposed reforms would allow, among others, for the introduction of a new seasonal work permit as well as changes to the labour market-needs test that applies prior to employers bringing in staff on work permits from abroad

Questioned by Labour Party senator Marie Sherlock, Mr Carroll said there was limited public information available regarding processing margins.

However he said the census of industrial production suggested the margins were somewhere around 1 per cent.

“These are very tight margins based on high levels of turnover.”

Cormac Healy of Meat Industry Ireland said there were published accounts of primary meat processors that showed profit margins of 0.3, 0.6 or 1 per cent

Sinn Féin employment spokeswoman Louise O’Reilly maintained the sector was very profitable and asked whether it had considered that if it raised its wage levels it might stimulate demand domestically for jobs in its plants .

Mr Healy said it was unfair to characterise the industry as being based on low pay.

“Wages have increased in the industry, that is for sure. People may come in at close to the minimum wage as a general operative position. There is opportunity to progress as skills and experience progress.”

Mr Healy said the sector operated in a very competitive environment and that pay was on a par or ahead of that available to workers in similar role meat processing businesses in Northern Ireland or in Britain with which it competed.

Mr Carroll told the committee in an opening statement that “international sources of labour will continue to be in demand under the two existing permit schemes available to the sector”.

“ The shortages that we face are unlikely to abate as we increasingly find that the sector is competing to attract the attention of a reduced pool of resident workers.

“Without the permit option to meet the labour need required in the meat sector, we would put in jeopardy hard-won export business, which is now more than ever facing global competitive challenges.” Mr Carroll said.

Edel McGinley of the MRCI told the committee the existing system for dealing with migrant workers “pits people against each other, it thinks an IT developer is better than a meat factory worker”.

She said the Government’s proposed new legislation “needs to give parity to workers on employment permits by giving gradual mobility to all general employment permit holders, similar to that already in place for critical skills permit holders – full labour market mobility after two years and immediate rights to family reunion”.

“ This will simplify and streamline the employment permits system and negate the need for a range of schemes, regulations and administrative processes. It is also in the interest of the State to introduce mobility in the employment permits system, as this encourages dynamism and progression, allowing workers to maximise their education, skills and experience,” Ms McGinley said.