Ciarán Lynch (Cork South Central, Labour)

I thank the Ceann Comhairle for granting me the opportunity to debate this matter along with the other Cork Deputies this afternoon. In September last year, the employer, Jack Ronan, and Vita Cortex informed the employees of the plant that he would make them redundant in December. At the time, the discussions indicated that the employees would receive 2.9 weeks for each year worked, and in some instances this is up to 40 years. During the period from September to December he said that he was in discussion with NAMA with regard to paying out the sum of money which, in total, came to €1.2 million. With redundancy payments having tax relief, this comes in at approximately €480,000. Jack Ronan's liability is less than €500,000 in this case. During that period he said that he was in ongoing discussions with NAMA and the workers. I came to the Dáil on 14 December and exposed this ruse. At no stage did NAMA state it would meet these payments because they were held in a separate account. No one knows better than Jack Ronan that NAMA is not a liable organisation in this case because Jack Ronan employed a financial company some years ago to restructure his companies and in such a way that liability would not travel from one company to another. No one knows better than Jack Ronan that the NAMA claim is a ruse. The fact is that Jack Ronan and his company must fork out the money and pay the €480,000.

There should also be a corporate examination of how this company restructured itself. One aspect of the company, Vita Cortex Cork, claims an inability to pay at present. However, there is also Vita Cortex Dublin, Vita Cortex Athlone and Vita Cortex Belfast and a host of other companies of which the same directors are in charge. It seems the shareholders and directors are the same for all of these separate companies.

It could be that the Department of Social Protection will have to pay the two weeks statutory redundancy to these workers and the Department will meet its obligations if it arrives in that place. Regardless of who pays the money, there should be a forensic examination of the company carried out to establish the interconnectivity between the different aspects of Vita Cortex holdings to ensure that if the taxpayer must pony up, it is the last court of recourse. A corporate structure aspect arises in this case and I am keen to know whether at any time there was any correspondence either from the Department, the union or any other entity to the Director of Corporate Enforcement to examine the corporate governance of this company. I welcome what the LRC has said as well. If Jack Ronan gets off the hook because of the way the company restructured its finances, we will see other companies taking the same model on board to escape their liabilities and the State will have to pony up in more circumstances. It is critical, therefore, that such an examination is carried out. Following such an examination we must consider whether legislation is required to ensure that the practice carried out legally by Jack Ronan in terms of corporate governance is changed. We must ensure that the laws are changed to ensure we do not see the type of skulduggery engaged in by his company to renege on payments to his employees.

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