Dáil debates

Thursday, 8 December 2005

7:00 pm

Photo of Micheál MartinMicheál Martin (Cork South Central, Fianna Fail)

I thank Deputy McGuinness for raising this matter on the Adjournment. He has been very sincere in tenaciously pursuing this issue in recent years. I recognise that other Deputies have done likewise and discussed it with me. The matter has been raised in this House on a number of occasions.

From the outset, I wish to state that neither I nor my predecessor have ever given any commitment to the former workforce at Comerama in respect of their entitlements under the redundancy payments legislation enacted in 2003. On 12 December 2002, following the announcement of the closure of the Comerama factory with a loss of more than 160 jobs, the Tánaiste, together with officials of the Department of Enterprise Trade and Employment met a SIPTU delegation representing the Comerama workers. As I understand from the official minutes of that meeting, the main concern of the workers, many, if not most of whom, had already been made redundant, was that if a deal on enhanced redundancy rates was made under the partnership process, it should be retrospective with regard to the workers concerned. In this context the Tánaiste gave an undertaking to do everything she could to ensure that the Comerama workers would get the retrospection. This undertaking was recorded in the official note of the meeting prepared by the official attending as follows:

An Tánaiste said that talks were on going in relation to the Statutory Redundancy issue. She gave an undertaking that if the legislation is changed she would do everything she could to ensure that the Comerama workers would be included in any amendment.

At the time neither the Tánaiste nor the officials attending the meeting were aware of the legal principle established by the courts that the Legislature cannot impose retrospective financial obligations on employers, or indeed anybody else. This was subsequently confirmed in legal advice given to my Department. The legal advice from the Attorney General was that: (i) The enhanced statutory redundancy payments require legislation to be enacted in order to be brought into effect, and; (ii) As the payment of a statutory redundancy lump sum is a legal requirement on employers, it could not be imposed on them with retrospective effect. In fact, employers are entitled to due notice, usually about two months, of the intention to legally require them to pay enhanced rates.

This legal position was communicated to the Comerama workers. Both the Tánaiste and I very much regret, therefore, that it was not possible to apply the new legislative provisions on enhanced redundancy payments to the Comerama workers or any other workers with retrospective effect after the new provisions came into effect in May 2003. The factual position in regard to the former workers of Comerama is that 154 of them had been made redundant long before the new rates of redundancy came into effect. As I understand it, they received substantially more than the then statutory rate in settlement with the company. Some 13 workers, who were made redundant by the liquidator of the company since May 2003, have been paid the new enhanced statutory rates from the social insurance fund by the Department. However, these amounts were less than the settlements received by the 154 workers who were made redundant before the company went into liquidation and received ex gratia payments.

Subsequently, at the request of the Tánaiste, two officials of this Department met a delegation of workers and union representatives at the factory premises in Castlecomer, County Kilkenny on Monday, 23 June 2003, to discuss the situation regarding the new rates of statutory redundancy in regard to the employees of the company, who were made redundant in December 2002 and January 2003. The union officials and the workers' representatives spoke at the meeting. They made the case that the workers who had already been made redundant up to January 2003 before the new enhanced rates came into force in May 2003 should be retrospectively paid these enhanced rates. However, on a voluntary basis, the company had already paid these workers about 3.2 times the then statutory rate. The two officials who travelled to Castlecomer were told by the Comerama workers that they had, at the time of their negotiations with their employer on redundancy terms, been prepared to accept, in final settlement of their redundancy claim, the 60% rebate the employer was entitled to claim and receive from the SIF. It is quite clear that no one, save the employer has any say in what he does with the 60% refund paid from the SIF, which he has claimed and to which he was legally entitled.

The case was also made on behalf of these workers that if it was not legally possible to meet their claim for payment of the enhanced rates, the Government should consider bringing a scheme to the Oireachtas to enable them to be paid the enhanced rates from the SIF, as a special case. This proposal was brought to the attention of the Tánaiste and actively considered but was ultimately deemed impractical. It would mean making a special case for the workers concerned on the basis that they had missed out by being made redundant quite a while before the new enhanced rates were passed by the Oireachtas into law. Many thousands of other workers are in a similar position and could make a case for special treatment. Unfortunately, for the workers concerned, my Department is precluded from paying the enhanced rates of redundancy with retrospective effect. Suggestions were made regarding the utilisation of the national implementation body in this matter. The role of that body is to ensure delivery of the stability and peace provisions of Sustaining Progress. As the redundancy element of Sustaining Progress contains no provisions regarding retrospection, the national implementation body has no role in this matter.

Of those made redundant, 150 attended for interviews with FÁS. Subsequently, 136 people were called for training and 98 of these attended. Most of this training took place between February and June 2003. Some further training was provided for a total of 35 individuals. Training was completed in 2003 and at that time, FÁS records indicated that 50% of the workforce who had engaged with FÁS on training programmes had progressed to employment.

There have been numerous representations made on this matter both to me and to my predecessor, and, over the past two and a half years, a large number of parliamentary questions have been tabled with regard to the Comerama workers. Notwithstanding this, the position has not altered. The payment of a statutory redundancy lump sum is a legal requirement on employers and cannot be imposed on them with retrospective effect. There are no legal provisions for making additional payments from the public purse to the 154 workers or those made redundant by the liquidator.

I am satisfied that everything possible was done to ensure that the Comerama workers got their full redundancy entitlements and that no commitment was given, nor could one be given, to retrospectively enhance statutory redundancy payments. I met the unions some time ago and recently discussed with my officials all the issues raised at that meeting, in particular, the issue of ringfencing. I do not consider it possible to facilitate the award of redundancy payments to one set of workers without extending them to everybody else made redundant before the new enhanced rates were introduced. I acknowledge the Deputy's concerns but hope that people equally acknowledge the issues facing the Government on this issue.

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