Wednesday, 11 October 2006
I thank the Leas-Cheann Comhairle for allowing me to raise this matter. This important issue relates to the constituency of Limerick West. Yesterday, we received news of yet another loss of jobs in County Limerick when Microtherm Limited in Bruff announced it was to close with immediate effect. Management informed the staff of 46 of this decision yesterday. The closure of the company will have major detrimental economic consequences for the wider community as an estimated wage bill of €1.5 million will vanish.
I thank the Minister for Enterprise, Trade and Employment, Deputy Martin, for his presence. As he will be aware, we had problems in Kantoher and a provisional liquidator was appointed to Castlemahon Poultry Products Limited two weeks ago.
Microtherm Limited, which has operated in Bruff since 1976, is by far the single largest employer in the town. Its dedicated workforce has competed in the highly competitive electronic component manufacturing industry for more than 30 years. Due to an increasing cost base, however, it now finds itself unable to match cheap foreign competitors. The workforce, which is predominately local to Bruff, comprises in many instances a husband and wife working together. We are just a few weeks from Christmas and many of those affected have young families and mortgages to pay. Replacement industries are needed in County Limerick.
Today, I accompanied a delegation from Castlemahon Poultry Products Limited to a meeting attended by the Minister, Deputy Martin, and his Ministers of State, Deputies Killeen and Brendan Smith. I thank them for agreeing to the meeting. As the Minister learned during his discussions with representatives of the workers at the plant and their trade union official, the company is experiencing serious problems. If the recommendation the provisional liquidator is obliged to submit to the court by 23 October is not good, it is clear what will happen.
Last week, a delegation of growers and suppliers of Castlemahon Poultry Products met the Minister for Agriculture and Food. It was anxious to determine if it could raise sufficient capital to try to continue operations at the company. The liquidator informed us that while two groups had shown an interest, no definite decisions had been made.
I thank the Minister for arranging a meeting between the group in question and Shannon Development. I understand €10,000 has been provided to the group to carry out a feasibility study.
Given the events which have unfolded in Microtherm Limited and Castlemahon Poultry Products Limited, I call on the Minister to further instruct the relevant State agencies to address the underlying concerns in the food processing and electronics manufacturing industries, namely, rising costs and cheap foreign imports.
For many years, Shannon Development has been to the fore in promoting industrial development and jobs in the mid-west region. As this function will soon transfer to the IDA and Enterprise Ireland, these organisations must step up to the mark and deliver much-needed replacement industries.
I welcome the opportunity to raise the important and upsetting matter of the loss of 46 jobs in Bruff, at a cost to the community and, in particular, the employees of Microtherm Limited, of €1.5 million per annum. The news that the company has closed is a major blow to Bruff and staff at the plant who find themselves without employment with very little notice. It is particularly devastating given that it is the town's biggest employer and has been a mainstay of employment for more than 30 years.
In fact, 30 years ago, in 1976, the former Minister and MEP, Mr. Tom O'Donnell, was instrumental in bringing this industry to Bruff. From discussions I have had with the IDA today, I understand it is almost impossible to compile a rescue package, as the production of the thermostats has moved to cheap labour areas in the Far East. Many of its customer base manufacturers have also moved to cheap labour markets. It is important that the State agencies, the IDA, Enterprise Ireland and Shannon Development, with the support of Ballyhoura Fáilte, ensure that a replacement industry is identified for the plant as soon as possible. A creditors' meeting will take place in the next ten days and the company, which is legally independent of the parent German company, will be liquidated.
The State agencies must immediately open a dialogue on the future of the plant and ensure that it continues as a place of employment for the people of Bruff. The loss of the jobs in Bruff is difficult for the people directly concerned. It has created unanticipated financial pressures coming up to Christmas. While it was evident for some time that there were difficulties, it is not possible to be psychologically or financially prepared for the blow of redundancy. Just over 20 years ago, I was made redundant on statutory redundancy, so I know the trauma a person goes through. Everything must be done by the Minister and his State agencies to help the employees to obtain replacement employment. There will be an urgent requirement for the training agencies to introduce programmes to prepare those made redundant for future employment, involving reskilling for many of them.
Coming on top of the announcement of the difficulties in Castlemahon Poultry Products, this is the second severe blow to employment in my constituency, Limerick West. The Government has dismally failed to create employment in the constituency. It is time the Minister for Enterprise, Trade and Employment to pay attention to the devastation of the losses that have occurred in the last month. I understand the Minister met the representatives of the Castlemahon employees today. As we speak, the breeding hens there are being gassed and the cycle of production has ceased.
I impress on the Minister the need to ensure that a replacement industry goes in there. I know some people have approached the Minister, Shannon Development and others. I accept that Shannon Development is doing a feasibility study. I ask that the Minister try to ensure that the skills in Castlemahon are not lost to the area or to the poultry industry and that those who have little opportunity for other jobs in the area continue to work in the field some of them have known for many decades.
I also ask that the Minister, in his contacts with Northern Ireland, seek that the O'Kane organisation honour the redundancy arrangement it made in previous negotiations with the people who are made redundant. I ask the Minister to contact the German parent company of Microtherm and ensure that it will at least treat the 46 people who are to be made redundant in Bruff decently. That is all I ask, that the employees of Castlemahon and Bruff are treated decently.
I thank Deputy Collins and Deputy Neville for raising this important matter. Like the Deputies, I was disappointed to hear about the situation at the company in question. I am conscious of the effect the job losses will have on the workers involved and their families as well as the community in the surrounding area. This is distressing news for those who will lose their jobs. I assure the people concerned that the relevant State agencies will provide every support they can. The priority will be to find alternative employment for those involved at the earliest opportunity. As Deputy Collins knows, we discussed the redundancy situation today with the workers at Castlemahon. Given what happened 15 months ago, it is unsatisfactory that they are being offered only statutory redundancy.
Unfortunately, the situation is a voluntary engagement between employer and employee, but we will pursue that issue in so far as we can with the employer, as we undertook today in our meetings with the workers' representatives.
As the Deputies know, Microtherm was established in Ireland in 1975 and employs 46 people in Bruff, County Limerick, where it manufactures thermostats for the white goods market. Unfortunately, the manufacture of thermostats is now uneconomic in Ireland as the sale price no longer covers the production cost. Over the past few years, I understand that the company's head office had been supplying orders to keep its Irish operation in production. This has been erratic, with orders varying from month to month resulting in the entire work force working part-time or full-time as the need arose to fill orders. However, the owners have concluded that the operation at Bruff is insolvent and a creditors' meeting is being called. I understand that the creditors' meeting is scheduled for 23 October 2006 and at that stage a liquidator is likely to be appointed. The general manager called a meeting of all staff yesterday morning. I understand he had no alternative but to cease production and close down the plant.
The role of the industrial training agency, FÁS, will now be particularly important for the workers. The company has already been requested to discuss the opportunities of operative retraining with its staff with a view to following up with FÁS. We have been doing this well in recent redundancies. FÁS has gone in early to provide one-to-one training programmes for the workers and to see if it can locate alternative employment for the workers through its wider job contact capacity.
The most recent live register figures, for September 2006, were released by the Central Statistics Office last week. The figure for County Limerick is 7,205, which is down significantly on last month's figure of 8,253. It is important to give the overall backdrop. Although it is no consolation to the workers involved, it shows a general buoyancy in employment in County Limerick.
A central goal for the industrial development agencies is the achievement of balanced regional development. The attractiveness of Limerick lies in its position as a regional gateway, with the critical mass and infrastructure necessary to attract mobile investment to the region. Both the Government and the agencies recognise the need to provide high-volume employment opportunities in Limerick that provide sustainable, long-term jobs. The strategies adopted have proved successful to date despite a competitive and ever changing global economy. There is a churn going on in the economy in jobs which are at risk of loss to low-cost locations. We are losing out in some respects there but are gaining jobs in other sectors of the economy.
While it is disappointing to see job losses at any time, fortunately Limerick has a strong base of foreign direct investment jobs. The most recent figures available, for December 2005, show that there were 38 overseas companies employing over 8,500 people in permanent jobs and a further 1,500 in temporary and contract employment. Most of these 10,000 jobs are in the city environs but as a result of the job losses in the company concerned, I am confident that the State development agencies will strengthen their marketing and promotion efforts in the region and make every effort to secure alternative employment for the area. This will be done in partnership with other key players to maximise the flow of potential investors for the area and to convert these into investment and job opportunities.
We will work with groups that emerge and wish to try to develop alternative or similar industries. Shannon Development and Enterprise Ireland will work with companies to see if we can grow jobs again on the indigenous front as well as trying to attract foreign direct investment in and get new activities for existing foreign direct investment companies in the area.
I am grateful for the opportunity to raise this subject and that my constituency colleague, the Minister for Enterprise, Trade and Employment, has chosen to respond on behalf of the Government. The loss of the 172 jobs in Roches Stores in Wilton is regretted by all in the area. All public representatives are anxious to pursue a common approach in seeking some remediation of the situation that has arisen.
I raise this issue on the basis that the loss of 172 jobs at any time is regrettable but there always seems to be more media attention and political reaction and concern when a similar number of jobs are lost in an industrial concern. Given, however, that our economy is now based 70% on services and retail, this is a significant loss of jobs for the people concerned. I am interested to hear what action the Minister has taken to date and what measures he believes can be applied towards securing alternative employment for the people involved.
The Minister and I are aware that there are commercial concerns at play here which fall outside the scope of normal political debate and reaction. I would like to believe that incidents of this kind could be avoided in the future if consideration is given to legislation in the relevant area. For example, in the area of the transfer of employment, there is strong legislation in place that is designed to protect the rights of the employee. I would argue that said legislation could be reconsidered in the context of the transfer of responsibilities from one company to a potential replacement company that could assume responsibility for the employment rights of any group of employees. It could also be reconsidered in the context of local authorities reassessing rates, service charges or, in the case of a commercial concern, rents. As the Minister is aware, the issue of rents is very much at the heart of this matter. What I am suggesting might not provide a ready solution to the predicament faced by the workers at Wilton. However, we must avoid the circumstances that have arisen and ensure that there is no recurrence.
It is regrettable that a commercial institution such as Roches Stores is moving on and replacing its shops with other businesses. However, the company has managed to do so successfully with its flagship store in Patrick Street and others throughout the country. Questions remain as to why this has not happened at the Wilton shopping centre. We must take a collective approach to this matter to ensure that an immediate solution can be found.
I offer these proposals by way of suggestion. The Minister, who has expressed much concern regarding this matter, shares the frustration of many in the constituency that matters have been allowed to develop to this extent, that a solution was not found before last Friday and that redundancy notices were issued to the workers in recent days. I would like to believe, however, that he remains as optimistic as I am that the potential exists for a resolution to this matter. If he is able to offer that glimmer of hope and comfort in his reply, the 172 people concerned would be grateful.
It must be remembered that those involved are mainly women — there are some men involved — whose rates of pay are average. In some circumstances, these individuals' length of service has been considerable and they have been extremely loyal to the company. Some of the people working with the company and hoping to transfer to another have developed relationships, the common goals of which are dependent on employment and success with whatever companies they work for in the future.
From a human perspective, I will be interested to hear the Minister's reply. I hope that not only will he indicate how he, the Government and his Department can respond but also how those of us who are also involved in representing the constituency, at national and local level, can react in a collective sense to help resolve this matter.
I thank Deputy Boyle for raising this issue and I accept his absolute commitment, and that of all public representatives in the city of Cork, in respect of it. As the Deputy is aware, the issue of the retail workers in question and their jobs concerns the transfer of a lease. The parties involved have been unable to reach agreement on the matter.
On Thursday and Friday last, we met the workers at Wilton. I contacted the majority owner of the centre and representatives of Marks and Spencer and Roches Stores on Friday. However, by late on Friday all our efforts had come to nothing. There was some indication at lunchtime on Friday that something might happen but, in the end, the issue could not be resolved.
At the weekend, I met the owner at his request. He gave his perspective and stated that he would be willing to do everything possible to bring about a resolution. I made an appeal on Friday and again on Saturday to both sides to enter negotiations and, in that context, I offered my services and those of the Lord Mayor of Cork as mediators. Telephone contact was again made with the two key players on Monday and I am of the opinion that Roches Stores would have provided a window of opportunity and a space to facilitate a resolution of the issue. There was engagement between the two sides on Monday, with correspondence being exchanged and offers and counter-offers being made. By late on Monday night, even though matters had moved on somewhat, the gap remained significant. However, at that point and throughout yesterday, I felt that the gap would not be closed. I am more pessimistic now than I was on Monday.
I have been conscious of the need not to raise the expectations of the workers for a second time. We met them on Friday and witnessed the roller-coaster of emotions on which they rode throughout the day. Both parties are anxious that the negotiations should take place away from the glare of the media spotlight.
Fundamentally, this issue revolves around the terms of a lease and that is why 172 workers are losing their jobs. That is not acceptable and I am deeply unhappy about it. In other areas throughout the country, the transfer of employees to other companies was effected in a way that did not give rise to angst and disagreement.
I take this opportunity, afforded to me by Deputy Boyle's raising of this matter, to again call on all sides in the dispute to make one further effort to resolve their differences. My overriding concern, like that of the Deputy, is the protection of all 172 jobs that are at stake. I reiterate that I and the Lord Mayor of Cork, who represents the city and its citizens, are prepared to act as mediators in this process. I have kept the Lord Mayor informed of developments as they happened.
The remainder of my script relates to the general situation pertaining to industry in Cork, the role of the industrial agencies there, the employment opportunities on offer and the successes of recent times. However, I do not believe the Deputy needs to be reminded of all that in the context of this issue. In fundamental terms, this matter comes down to a dispute regarding the amount of rent and square footage involved.
There are areas that could be considered in terms of the transfer of undertakings etc., but this matter would not really be suitable in that regard. I would argue that Roches Stores made a good effort to transfer staff but that effort came unstuck in respect of the workers at Wilton. The matter was not closed off and not everything was tidied up prior to the cessation of trading at Roches Stores, which is probably what gave rise to difficulties in this instance.
I will consider what the Deputy suggests because a number of issues arise in respect of this case. The situation is unsatisfactory from the perspective of the workers. Both parties have indicated their understanding of that fact to me and stated that they appreciate the position in which the workers find themselves. If the overriding concern of those involved is the welfare of the workers and their retaining their jobs, this matter should be resolved. That is my challenge to the parties concerned. This important matter involves 172 people and their families, and a resolution should be found.