Peadar Tóibín (Meath West, Sinn Fein) | Oireachtas source

I move amendment No. 13:

In page 26, between lines 7 and 8, to insert the following:“Liability of a company officer or officers for a breach of employment law
28. Where a breach of employment law is committed by a body corporate or by a company officer or officers acting on behalf of a body corporate and is determined to have been so committed, with the consent, connivance or approval of, or to have been attributable to any neglect on the part of, a person or persons who, when the breach was committed was a company officer or officers of the body corporate, then that person or persons shall be personally liable for the breach committed.”.

This is an important amendment. The topic is something we have discussed on a regular basis in the past three and a half years. There are many examples. Let us suppose company A tenders for a local authority project. Company A will have the necessary length of time in existence, the necessary insurance capacity, the necessary funds and the necessary turnover, etc. Company A then wins the tender and employs staff through another associated company. Usually these companies have the same directors. This is known as a corporate veil. A paper wall is built within one entity, creating two entities, in an effort to achieve a specific objective. In the case I have in mind, company B, which employed the staff, then went to the Labour Court and argued that it could not afford the rates of pay and was in a position in which it was about to collapse. The determination was that there would be some decrease in the wages of the staff as a result. We have seen this with retail outlets as well. We have also seen it in certain insolvency cases whereby certain people maintained they could not afford redundancy payments, etc. It is an important issue.
The status quohas the effect, in the construction, waste disposal and retail sectors, of significantly reducing people's rights, entitlements, wages and conditions, and often their redundancy and future pensions. I have sought information and advice on the matter. Previously the view was that constitutionally nothing could be done because a corporate entity was a specific person in front of the law. I understand that although we may attribute a criminal offence to such individuals, it cannot be done. Anyway there is no doubt in my mind that there have been cases before the Labour Relations Commission whereby company B has been made responsible for the actions of company A. For example, I know of a case in which an individual employed people under a transport name to, mar dhea, transport items to a construction site. Then, on the construction site, those individuals were involved in construction. The purpose was to avoid paying the rate agreed under the registered employment agreement for the construction site. This amounted to wholesale manipulation of the loophole for the benefit of unscrupulous employers and to the detriment of the workers. It is interesting that the Irish Congress of Trade Unions has supported this particular amendment and said that it is a necessary measure. I am requesting that the Minister support the amendment to pierce the corporate veil.