Seán Sherlock (Cork East, Labour)

I appreciate that and thank my colleagues. I want to ensure we address the legislation before us.

The current legislation also ensures that insolvency payments are paid to employees in respect of unpaid debts, such as wages and holiday pay, from the social insurance fund and protects employees' entitlements in the event of an insolvency. Liquidation, the most common status pertaining to insolvency, is a permanent irreversible condition whereas the trading status of a company may change significantly depending on its circumstances. In the circumstances, it is not necessary to include a new category regarding the cessation of trading as part of the insolvency payments scheme.

On the proposed amendment of section 6 of the Protection of Employees (Employers' Insolvency) Act 1984, I am satisfied the current provisions, contained in section 7 of the Act, are sufficient for this purpose. The current legislation facilitates access to appeal to the Employment Appeals Tribunal and the proposed amendment of section 9 is not necessary, given the reform process underway in respect of the employment rights adjudication bodies of the State.

Sections 9 and 10 of the Protection of Employment Act 1977, as amended, make it mandatory on employers proposing a collective redundancy to engage in an information and consultation process with employees' representatives and to provide certain information relating to the proposed redundancies. An employer is prohibited from issuing any notice of redundancy during the mandatory minimum 30-day employee information and consultation period. The existing legislation provides for a range of sanctions to be applied against an employer where he or she fails to meet the information and consultation obligations under the Act, whereby failure to comply with section 9 on failure to consult or section 10 on failure to provide certain information, may result in a fine of up to €5,000. Section 12 of the Act makes it mandatory for an employer to notify the Minister for Jobs, Enterprise and Innovation of his or her intention to create collective redundancies at least 30 days prior to the first dismissal taking effect.

As I have indicated, while the thrust behind the legislation may be well intended, ultimately, this Bill is impractical and crucially may expose the taxpayer and the wider economy to major unintended consequences. There are two main difficulties with the Bill. The 90-day consultation period for large companies is unrealistic and is inconsistent with the flexibility needed by companies to make decisions on restructuring and change. The one certainty is that by imposing a consultation period as long as 90 days, the rule will be honoured more in the breach than in the observance. Equally, it could involve a prolonged period of uncertainty for employees, some of whom may be discouraged from remaining with a particular employer in what would be an artificially extended period of doubt.

The proposed period of 90 days is significantly greater than in most other EU member states. Significantly, the UK's Department of Business, Innovation and Skills is also actively evaluating the relevance of the continued application of the 90-day provision in the context of its own economic circumstances.

The proposal surrounding the circumstances of a company ceasing trading and the granting of redundancy payments is overly simplistic and potentially lets the employer off the hook for what he or she should be rightfully paying by way of redundancy payments. The proposal has the potential to encourage abuse by employers and will expose the taxpayer to costs that he or she should not have to bear.

I ask the House to bear in mind those companies that are operating outside of this jurisdiction. It must be also recognised that several of the cases that have given rise to this Bill concern a small number of intractable scenarios where sudden wind-ups have occurred as the result of court orders, many of which have been extra-jurisdictional, typically in the UK, and no consultation or information period whatsoever - be it 30 days or 90 days - takes place. An extended notification period to employees in such difficult and atypical circumstances would be of limited use in seeking to improve the circumstances of affected employees. The existing 30 day information and consultation period and the 30 day notification period to the Minister for Jobs, Enterprise and Innovation have served the State well for more than 30 years and neither employer nor employee representatives have ever sought their amendment. This is because, in the majority of normal collective redundancy situations, employers comply with the required information and consultation period, specifically that no dismissals take effect within a 30 day period.

In fact, in practice, the notice period provided in proposed collective redundancies very often exceeds the minimum statutory provision. A representative sample of redundancy notifications received by the Minister in 2012 shows that a majority of employees in collective redundancy situations already receive in excess of 30 days' notice that redundancies are planned for the company. More than 65% of the notifications provided for a minimum period of six weeks before the first redundancy was due to occur, while 50% provided for a minimum period of two months before the first redundancy was due to take place. Even in redundancy situations that did not provide for more than the minimum 30 day information and consultation period for some employees, the redundancies were often proposed on a phased basis, with many employees receiving longer notice of the planned redundancies.

Existing legislative provisions contained in the Protection of Employment Act 1977 allow for National Employment Rights Authority inspectors, as authorised officers of the Minister for Jobs, Enterprise and Innovation, to carry out inspections to establish whether the Act is being complied with. I would encourage any employees who believe their employer has not complied with the requirements of the legislation to make a complaint to the authority under the provisions of the Act.

The Government is strongly committed to the protection of employees and the enhancement of their employment rights. This commitment is most in evidence in the reform of the statutory workplace relations structures and processes initiated by the Minister, Deputy Richard Bruton. He is committed to delivering a world class workplace relations service. His main aim is to provide a simple, independent, effective, impartial, cost effective and workable means of redress and enforcement within a reasonable period of time. Substantial progress has already been delivered in this regard. A key element of the next phase of reform will be the delivery of a just, fair and efficient adjudication service provided by independent, professional and impartial decision makers.

I am aware I have gone beyond my allocated time, so I will leave it at that.

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