Dáil debates

Thursday, 10 July 2014

Ceisteanna - Questions - Priority Questions

Employment Support Services

9:30 am

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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1. To ask the Minister for Jobs, Enterprise and Innovation his plans to review the manner in which the State assists employees in companies in which management has expressed a desire to undertake a major restructuring of operations, including proposing substantial pay cuts and job losses; if his attention has been drawn to any other planned large-scale restructuring; and if he will make a statement on the matter. [30046/14]

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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I have tabled this question in the context of what happened at Bausch + Lomb and the manner in which a difficult and public choice was foisted on workers there. What strategies does the Minister's Department have in place to stop that process from happening in other companies? What assistance is available to workers from the Department?

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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A key element of the work of my Department and the development agencies is to work closely on an ongoing basis with client companies to ensure potential threats to employment in their operations are identified well in advance in order that they can be addressed before major difficulties emerge. There is a significant level of engagement with companies, quietly and behind the scenes, to address ongoing challenges and help them to develop new strategies, change their business models, where necessary, and further embed their operations in the economy. This work by the agencies includes pursuing relevant research and development opportunities, promoting training initiatives, the provision of targeted grant aid in specific circumstances, and developing capacity building and transformational management systems. A good example is a key disruptive reform set out in An Action Plan for Jobs 2014. It provides that the main development agencies will drive a national step change for the manufacturing sector which will drive the adoption of LEAN programmes and other initiatives to improve the competitiveness of these businesses.

In addition, an early warning system is in place to flag unexpected job threats which may emerge at short notice. In such instances, the agencies, my Department and I, as Minister, work with the company to develop alternatives or mitigate the worst impact on workers. We also explore all possible supports that might be available across government. This was the approach taken in the Bausch + Lomb case in Waterford.

The services of the State's industrial relations machinery are always made available to assist parties in a dispute. It is heartening that the work of the Labour Court and the Labour Relations Commission which come within the remit of my Department has managed to resolve many apparently intractable disputes and resulted in positive outcomes in cases involving restructuring. Where jobs are still lost, despite best efforts, my Department works with other Departments to ensure services are made available to workers to clarify their entitlements and develop other opportunities for those affected.

The overall process, involving many State stakeholders, works well. It is continuously learning and responding to the changing global environment. As of now, I am not aware of any such proposed large-scale restructuring which may arise in the near future.

Photo of Seán BarrettSeán Barrett (Ceann Comhairle; Dún Laoghaire, Ceann Comhairle)
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Before calling Deputy Dara Calleary, I ask Members to turn off their mobile phones, as there is interference. We are advised by the technical staff that, if that happens, they cannot use the playback facility for use on radio or television. It is everybody's interests, therefore, to switch off all mobile phones.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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I appreciate the range of responses from the Minister's Department and I am aware of the early warning system in place. The specific circumstances of the case at Bausch + Lomb were known in the Department and its agencies, but the workers seemed to be the last to know. They were then presented with a Hobson's choice and forced to take difficult reductions. I congratulate everybody involved in that process, including the Department, SIPTU and various employers, to try to achieve a resolution. However, the workers were presented with a choice of either accepting pay cuts or having the entire operation shifted. That is an unacceptable and very difficult choice to have to make and the workers were placed in a no-win situation. As I have said before, I do not think the outgoing CEO of IDA Ireland was helpful in that regard. It was his job to try to assist the company, but he told workers to take the deal on offer. This was particularly unhelpful and unfair and I do not want to see it happen again. Workers should not be placed in a difficult position in having to take decisions that will affect their personal lives. In taking such decisions they are put under the microscope and there is enormous publicity and pressure, knowing that their decision will affect 1,000 others. Is there a way by which the Department, working with various agencies, can ensure what happened will not recur?

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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Each case has to be treated on its merits. The company is the primary point of contact with workers. Clearly, IDA Ireland and other agencies have to respect the company's confidentiality. Such companies are often quoted on the Stock Exchange. If they indicate the direction of their thinking in confidence to IDA Ireland, giving it an opportunity to work with it to achieve the best possible outcome for Ireland, that confidence must be respected. It is not a situation where the best approach is to tell everyone what might happen in the hope one can develop a response. In the Bausch + Lomb case we had to work behind the scenes to develop proposals to achieve the best outcome, as well as putting investment proposals on the table, with other supports, to allow a successful deal to be reached. Obviously, it is for the company to deal with its workforce. As the Deputy knows, the issue emerged from a takeover or merger that had evolved, which had created a tight timeframe.

Photo of Dara CallearyDara Calleary (Mayo, Fianna Fail)
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The Minister has teed it up for me. The company involved in the merger is sniffing around - for want of a better phrase - other Irish companies. I welcome the statement that there are no large-scale redundancies on the Minister's radar. Does IDA Ireland have a strategy in place, not just for the specific company mentioned but also for the pharmaceutical sector generally? Many companies involved in the sector are, effectively, asset-stripping, while floating around and looking for potentially good research and development opportunities that may result in a commercial return for their own investment companies. Is the Department aware of this and, if so, is it working on a strategy for the pharmaceutical sector to guide it through this phase?

Photo of Richard BrutonRichard Bruton (Minister, Department of Jobs, Enterprise and Innovation; Dublin North Central, Fine Gael)
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Absolutely. Consolidation in the pharmaceutical sector is a fact of life. IDA Ireland's objective is to ensure that in any such consolidation Irish plants will be in a position to win in any restructuring. That is a continuous challenge that we are always addressing in working with companies to ensure plants in Ireland are the best they can be. We have a strategy, but, obviously, one must respond to individual decisions made by corporates.