Peter Burke (Longford-Westmeath, Fine Gael)

I thank the Cathaoirleach and members for making committee time available to discuss the Protection of Employees (Employers' Insolvency) (Amendment) Bill 2025. We had a very constructive debate on Second Stage and I welcome the support for the Bill from right across the Dáil. While the Bill is quite complex and technical, it has a clear aim of further supporting employees in the event of their employer's insolvency.

As it stands, where an employer becomes insolvent and employees are owed wages, holiday pay and so on, the State protects those pay-related entitlements. They are usually paid to a liquidator or receiver to distribute to the employees. These payments are made from the Social Insurance Fund under what is generally known as the insolvency payments scheme. The Bill makes a number of changes to how that scheme operates. The primary change is to give effect to the Glegola Supreme Court judgment in which the court found that Ireland had not fully transposed Directive 2008/94/EC, which protects employees' pay-related entitlements in the event of their employer's insolvency. Crucially, the Irish transposing legislation, namely, the Protection of Employees (Employers' Insolvency) Act 1984, did not provide protection to employees whose employers go out of business but do not go through insolvency processes such as liquidation or bankruptcy.

The Bill is designed to remedy the gap identified in the Supreme Court case. It will ensure new cohorts of employees are protected under the insolvency payments scheme. It will set up a new statutory process for employees to seek to have their employer deemed to be insolvent. That will then enable the employees to secure their outstanding pay-related entitlements under the insolvency payments scheme. This will extend the scheme's protection to a particularly vulnerable group of workers.

Separately, the Bill will give an employee impacted by the Supreme Court judgment since October 1983 the opportunity to make a claim. This time-limited scheme will be open for two years, with a further two years possible in exceptional circumstances.

Today, I will put forward seven amendments to the Bill. The most substantial of these is to section 8 and has to do with how pension contributions are protected under the insolvency payments scheme. First, I will amend the legislation to ensure that contributions to the new auto-enrolment retirement savings system, My Future Fund, will be protected in the same way as other pension scheme contributions. This was always the intended policy, but it is insufficiently certain that the detailed wording of the 1984 Act provides this protection. My amendments will put this beyond doubt. Second, I will put in place specific rules to calculate what employer contributions to defined benefit pension schemes are covered under the insolvency payment scheme. This will close a loophole whereby the taxpayer's liability to cover employer pension contributions can be determined by pension scheme rules to which the State is not a party.

I look forward to discussing these proposals in more detail with all members.