Dáil debates

Tuesday, 3 March 2015

6:25 pm

Photo of Brian WalshBrian Walsh (Galway West, Independent)
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Deputies Terence Flanagan, Broughan, Kenny and Finian McGrath will each have two minutes as well as a final minute to respond following the Minister's remarks.

Photo of Terence FlanaganTerence Flanagan (Dublin North East, Independent)
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I thank the Ceann Comhairle for the opportunity to raise this important issue. I also thank the Minister for organising a briefing for local Deputies today.

Last Thursday's announcement of job losses at Cadbury, particularly in Coolock, is worrying and has had a significant impact, with the news still sinking in for the hundreds of employees at the plant. Like everyone in the community, I am shocked that Mondelēz Ireland is seeking redundancies there. Cadbury has been a major part of the Coolock community, employing local residents since it first opened in 1964. This is devastating news for Cadbury's employees and their families. My thoughts are with them, as they face an uncertain future. It is important that the company keep job losses to a minimum and that it be open with staff regarding the process.

The news came as a bolt out of the blue. I am concerned that employees were given little prior notice. All Government agencies should be involved in assisting those who lose their jobs in the months ahead. I would be grateful if the Minister outlined the supports his Department, Enterprise Ireland and the IDA will make available to those who will be made redundant. Will he ensure that a fair package is agreed for them in the negotiations and confirm that the majority of the redundancies will at the very least be voluntary? Will he also provide information on Cadbury's recent difficulties? Is he aware that the Hershey Company has tried to block the import of chocolate into America? What effect is this stamping out of competition having on the workers?

Photo of Tommy BroughanTommy Broughan (Dublin North East, Independent)
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I thank the Minister for the briefing. What are the chances of reversing these appalling job cuts in Coolock? It is clear that there were extensive contacts between the Minister's Department, the IDA and Enterprise Ireland and Mr. Justin Cook, managing director of Mondelēz Ireland, during the past two years. If so, why was last week's announcement made in such a particularly shocking and cruel way? Why was more not done to stop these job losses?

Following Kraft Food's takeover of Cadbury in 2010, Kraft Food made certain commitments. For example, we were told that the plant in Coolock was so efficient that it beat off another in Bristol to be maintained. If it was so cost effective then, why are we now grappling with this situation and being told of cost issues? Many of the other countries that are famous for producing chocolate, for example, Belgium and Switzerland, are high-cost, high-wage economies. There seems to be a gap in what the company is saying.

Our first concern is for the workers who are being made redundant, the conditions applied, whether their redundancies will be voluntary and what their pension entitlements and the entitlements of those who have retired beforehand will be. What has the Minister done to secure these entitlements?

As Deputy Terence Flanagan stated, Cadbury is an iconic name on Dublin's north side, specifically in the five Coolock parishes and the other parishes in Kilbarrack, Donaghmede, Edenmore, Raheny and Airfield. Thousands of families have been supported by the company for many generations. Often, the key breadwinners were women. They valued Cadbury for that. Since 1964 when the Coolock facility opened, it has played a major role in our country.

The figures that the Minister provided for the number of remaining jobs do not seem to add up with what the company is saying. It refers to 700 jobs whereas the Minister seems to be saying it will be fewer than 400 at Coolock and Rathmore in County Kerry. Will the Minister clarify the figure?

Last Thursday was a sad day for Coolock. As someone who has represented the area for nearly 35 years, will the Minister revert to us with some strong suggestions for the future of the area?

Photo of Seán KennySeán Kenny (Dublin North East, Labour)
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I join with Deputies in expressing concerns at the manner in which the news of this bombshell came out of the blue to the workforce at Coolock, where it is predicted that between 90 and 110 people will lose their jobs. For the workers selected for redundancy, it will be a dark day.

For almost 60 years, Cadbury in Coolock has been an iconic brand and provided good employment on the north side of Dublin. Recently, it was taken over by Mondelēz Ireland, part of the multinational Kraft Foods. The workforce of Cadbury has given sterling service to its company down the years. That workers' jobs will be gone when the lines they currently produce are transferred to Poland where there are lower wage costs is galling. This fact has added to their anger and to that of their colleagues in Tallaght and Rathmore.

There are also concerns that Mondelēz Ireland is planning to restructure the existing terms and conditions of employment, with the number of shifts with 12 lines being consolidated into six lines. Paradoxically, all of this has happened after a recent announcement of an investment by Mondelēz Ireland of €12 million in the Coolock plant.

Concern has been expressed to me regarding the future of the Cadbury pension fund and the position of retired workers currently in receipt of pensions. I understand that their positions are not secure under the transfer of undertakings (protection of employment), TUPE, legislation. Will the Minister clarify the situation?

I understand that the unions representing the workforce met Mondelēz Ireland's management yesterday and that further talks are planned. What can the Minister do to minimise the effect of the proposed redundancies on the wider community on the north side? What retraining and reskilling options will be made available to the redundant workers and will they receive assistance in accessing similar employment that uses the skills they have acquired?

Photo of Finian McGrathFinian McGrath (Dublin North Central, Independent)
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I thank the Ceann Comhairle for the opportunity to speak during this urgent debate on the job losses at Cadbury's chocolate factory in Coolock. This is a bad and sad blow to all of the staff of Cadbury and their families. It is also a significant blow to the people on the north side of Dublin. The staff, their family members and the people of my constituency have been gutted by the announcement of 145 job losses. It is a severe blow to the local economy, particularly when the company is making considerable profits in this country. We all have many friends and neighbours working for Cadbury. It is a major loss across the north side of Dublin.

Given the references to cost differences and restructuring, many of the remaining staff are worried about the future and the deterioration of their working conditions. At today's meeting, the Minister and Enterprise Ireland stated that the company's long-term interests were good, but that is not what I am hearing on the ground. Staff are worried about their pensions and their terms and conditions of employment. The TUPE issue is a significant concern for many staff, particularly electricians and fitters. The Minister needs to address these matters in his response.

A profitable company is claiming that it is investing more while also laying off staff and destroying working terms and conditions. Did IBEC play a role in this? A recent report in the Financial Timesstated categorically that there was overwhelming evidence of higher levels of pay increasing productivity. We must be careful to ensure that this instance is not just another race to the bottom. Let us hope that this company is not just harvesting expertise and experience before heading back with its money to Zurich or Poland. I urge action on this company. The north side needs jobs, investment and the Government's support.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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I thank the Deputies for raising this issue. I share their concern for the workers involved. This is a disappointment for many people.

I have known this company intimately over a long period. It set up in Dublin in 1932 and, therefore, it has been here a long time. At any given time, we work with companies that are developing opportunities to grow and, sadly, with companies, including Cadbury, that are struggling with issues they have to overcome. We put a great deal of time and effort into working with Cadbury in the hope that this could be avoided. I spoke directly to those at the highest level in the company seeking to have this not occur but, unfortunately, the cost difference was such that it felt obliged to proceed with this. Nonetheless, as we outlined in our meeting with the Deputies earlier, the company is committing to an investment of €11.7 million in the site. It believes that it has a strong future in Dublin and it is putting hard money into that. Clearly, we will work with the company in seeking to deliver sites in Coolock and Rathmore that can be successful and grow into the future. It is worth recalling that in the Bausch + Lomb case, we faced similar downsizing and restructuring of terms and conditions and so on but the company is now growing and adding employment. It is my hope that this will be repeated in this case.

I assure the Deputies that I have instructed EI to do the co-ordination work across all the State agencies, including the Department of Social Protection, SOLAS, local enterprise offices, NERA and all the other services that could be of support to workers in this scenario.

A number of Deputies raised the issue of the transfer of undertakings legislation, which provides a guarantee that where an employer changes, that cannot in itself change the terms and conditions of employees. At the point of transfer, their terms and conditions are protected but that does not prevent a restructuring arrangement taking place in those circumstances.

The company is entering negotiations with trade unions. It has a history of offering reasonable terms in these circumstances but, clearly, this is a matter for the company and the trade unions to negotiate. The challenge for us is to work through this and to protect as many quality jobs in the plant as we can such that it will have the capacity to expand and be competitive in the longer term. It is a tough and competitive world and Deputy Finian McGrath is correct that investment in research and development, innovation and lean technology processes is crucial to maintaining strong manufacturing sectors and we stand ready to support the investment in those areas. Clearly we cannot offer capital support in Coolock.

We will not only look to source jobs in Coolock, Tallaght and Rathmore. We are focused on finding alternative employment and that remains our abiding drive. In Dublin, we have had considerable success. A total of 35,000 people in net terms have returned to work over the past four years and we are witnessing a recovery in manufacturing following almost 25 years of decline. There are issues we need to work through and I assure the Deputies that the support of State agencies will be available to the workers affected. We will work with the company and the workers who are retained to ensure they have strong and sustainable employment prospects when this process is through.

6:35 pm

Photo of Terence FlanaganTerence Flanagan (Dublin North East, Independent)
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I thank the Minister for his response. I acknowledge he is hugely genuine in trying to ensure alternative employment is found for workers in the area. Reskilling and retraining are possibly needed and, as he said at our meeting earlier, there are opportunities in Mylan in Baldoyle. Perhaps he could elaborate on what other opportunities there will be for these workers in the months and years ahead. The decision came as a bolt out of the blue. People are only coming to terms with it and there is an adjustment factor. It will takes time, as it is a huge strain on the workers who will be directly affected. There is concern that the terms and conditions of the workers who are retained will be watered down and this process will be used as an opportunity to do so. Can the Minister give an assurance to the workers that their terms will not change? Will he ensure a fair redundancy package is offered to the workers directly affected, including pension entitlements? As Deputy Finian McGrath said, this is not a profits issue. The company is successful and making huge profits. It needs to reward workers directly.

Photo of Tommy BroughanTommy Broughan (Dublin North East, Independent)
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How much of the €11.7 million investment programme will be used to ensure the workforce in Coolock will grow in the future? Upskilling and replacement jobs are needed for those made redundant but is there a commitment to increase the number of jobs in the Coolock plant?

A number of food companies have closed in the area in recent years, including Chivers and Tayto nearby. These were iconic Irish brands and, although the Minister represents the area, he has done absolutely nothing since taking office to restore the high quality production jobs lost in Coolock. He referred to the number of jobs gained in Dublin but almost 65,000 have been lost under the Government and the previous disastrous Government. Cadbury under Donal Byrne and his successors was a strong supporter of local development. I was the founding chairperson of Coolock Development Council and I have been a long-time director. Has the Minister finally removed the threat to the business development manager grant, the provision of which was uncertain over the past year? It has produced many jobs on the ground in the Coolock area.

Photo of Seán KennySeán Kenny (Dublin North East, Labour)
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I thank the Minister for his response and for meeting with local Deputies earlier along with EI officials. I am glad he has given assurances that he will use his office to ensure redundant workers are provided with opportunities for retraining through EI, SOLAS and the local employment service. The message I am getting from workers is that the workforce in Coolock is in competition with other Mondelēz International sites and because of the lower wage costs in Poland, in particular, production is being transferred abroad. People are losing their jobs in Coolock because it is cheaper to move to another site with lower wage costs. That is galling for those who have worked all their life in a company such as Cadbury. They have contributed to the company's growth and profits. It is disappointing for them to have to face this now. I am grateful for the opportunity to raise this issue.

Photo of Finian McGrathFinian McGrath (Dublin North Central, Independent)
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I welcome the €11.7 investment because such investment is important on the north side of Dublin.

In 1824, John Cadbury opened a small grocer's shop at 93 Bull Street in Birmingham. He came to Ireland in 1932 and to Coolock in 1964. The plant exports approximately 200 products to 30 countries, which is worth €110 million to the economy. Does the Minister accept that this magnificent company and wonderful productivity was the result of a high quality workforce on the north side of Dublin? The workers delivered quality products. He should be cautious about losing high quality people with great expertise to low cost countries that might not have the same standards we have.

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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This is a reminder to us that every day is a battle. We are trading in a competitive global environment and costs in plants in a global group such as this are compared. That, unfortunately, is the world in which we live and if we want to sustain higher pay, we have to have better production process, increased efficiency and so on.

That is one of the tough parts of the environment in which we are trying to compete. I think Ireland has been very successful in this regard. We have been very good adopters of lean technology. We are innovative. Our workers are very flexible. That is true in all of our plants. While this comes as a huge blow, we have an opportunity to work with the investment the company is making to ensure the plant that remains is very competitive and provides good jobs into the future. There are alternative retraining opportunities. When it is clear who will be losing their jobs, we will undertake an audit of their skills and needs and talk to them to see what would best suit them. Many options, including SOLAS training, are there to re-equip them.

When I raised the issue of a package with the company, I was told that it wishes to negotiate directly with the trade unions. I think people will recognise that it has offered reasonable packages in the past. The company is fully committed to getting this plant up to the highest competitive standards. It wants the plant to be what it would describe as a tier 1 plant. That would make it a leader in the group. There is a strong commitment here. Obviously, that will require a great deal of reskilling, etc. The company is restructuring its lines from 12 to six. This will involve many changes in conditions and shifts, etc. That is what is being negotiated. I think there is something to work with. As Deputy Finian McGrath said, the company has a very long history and has provided quality employment over a long period. I hope we can work to ensure it continues to be an important employer after this. I share the other Deputies' sympathy for those who are confronted with this uncertainty. We will do our best to work with them to get the best possible outcome.