Séamus Healy (Tipperary South, Workers and Unemployed Action Group) | Oireachtas source

In introducing this Bill the Minister said that we were at the foothill of a very big debate and that this is a landmark project. There is no doubting that is the case. The Bill has been in gestation for almost 12 years under the remit of six successive Ministers and numerous reports. It comes from a very different and damaging era in Irish society, which had an ethos of light touch regulation. That culture has had devastating effects on Irish society and business and on workers and their families. There have been six austerity budgets, annual or more frequent cuts to services, huge tax increases and significant job losses and emigration. Unemployment stands at 14% with 430,000 unemployed and many people leaving the country.

The Bill comes from that era and is, unfortunately, deeply flawed in several areas as a result. Small and medium-sized enterprises are vital to the retail trade, the economy, its recovery and employment creation. We must ensure the many retail outlets and businesses closed on the main streets of every city, town and village are brought back to life to create employment. I welcome those aspects of the Bill that reduce the burden of red tape and help the day-to-day operation of businesses.

Unfortunately, under the cover of this legislation, there are some seriously flawed provisions and omissions which must be rectified. The Bill provides that a private company limited by shares, or the new LTD company as it will be known, will have the same legal capacity as a natural person. I am advised that this is a seismic shift which will prove seriously damaging to workers’ rights, particularly the rights of women workers. Giving a company the legal personality of a natural person is unprecedented. It is hard to understand and believe Cabinet members who were formerly trade union officials, including the Tánaiste, could leave this provision through the Cabinet.

The Bill should include a specific provision to ensure workers would be regarded as stakeholders for the purposes of representation on the boards of companies and, accordingly, would have the right to sit on the board. The Bill also states a LTD will no longer be obliged to go through the formality of holding an AGM, annual general meeting, whereby all members must convene at one location at the same time once a year. Instead, members will be allowed to have a written AGM, whereby all matters can be dealt with. This is an incredible provision which will have seriously damaging effects on many companies. Residents in apartment blocks run by a management company will now not have the right or entitlement to attend an AGM to hold the company to account. This is a wrong and damaging provision which should be withdrawn.

The Bill will allow a LTD to have only one director; under the current law the minimum number has been set at two. The current arrangement should remain, as it allows for necessary checks and balances. Provision should also be made for public interest directors with legislative teeth, not like those in some of the banks who just want to be paid and have no hand, act or part in the running or calling into account of the banks’ boards on behalf of the public.

Workers should be priority creditors when it comes to redundancy payments, with the ring-fencing of company pension funds to ensure companies cannot declare themselves bankrupt or go into liquidation, leaving huge holes in such funds. I congratulate and compliment the workers of Waterford Crystal who this morning won a significant court case on their entitlements and rights in pension payments.

The issue of commercial rates or local development charges, which present a particular difficulty for small retail companies, has not been addressed in the Bill. Neither has the hoary old chestnut of upward-only rent reviews. The Government promised it would deal with this issue and the Bill provides an opportunity to do so. An affordable examinership process must be introduced so as to make it accessible to small businesses.

I would go so far as to suggest the Bill should be withdrawn and redrafted as it contains significant flaws. At a minimum, there should be significant amendments to address the issues I have raised. The Bill which, in particular, gives a LTD the legal personality of a natural person is simply not good enough

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