Tuesday, 23 October 2018
Last Friday, the Authentic Food Company's plant in Dundalk went into interim liquidation. The staff of 180, some of whom have given up to 25 years of loyal service to the factory, look set to lose their jobs. The dogs on the street knew for some time that things were not right. Appeals from staff for clarity about the future intentions of the company fell, unfortunately, on deaf ears in recent months and weeks. The Unite trade union, the representative body of the workers, was conscious that the firm appeared to be in very choppy waters. Local management, unfortunately, appeared to be sidelined and left in the dark. We know there are no jobs in a closed factory and the union knows that as well. On that basis, the Unite trade union did the responsible thing and formally contacted the company's parent operation in the UK.
As any responsible trade union would, Unite sought on several occasions to meet the key decision-makers from the company formally. The union sought to establish the nature and extent of the problems at the Dundalk plant and to offer to work with the company if it needed to engage with the union to change course and ensure the survival of the operation. Time and again, however, the union's approaches were rebuffed and stonewalled. The union was, frankly, given the two fingers by the operation. Against this backdrop and as the clock ticked towards the appointment of a provisional liquidator last week, workers at the plant reported the transferring of profitable production lines from the Dundalk facility to the parent company's facilities in the UK.
Given what we know and the Dundalk company's refusal to engage with its staff and the union, I can only conclude that the operation in Dundalk appears to have been deliberately run down. Last week, the parent company in the UK pulled its support. The Irish operation is a subsidiary of the UK parent. The Minister of State and, more appropriately, the Minister for Business, Enterprise and Innovation, Deputy Humphreys, need to take a close look at this. The behaviour of the Irish arm of the company and the activities between it and its parent in the UK need to be examined formally and forensically. All too often we have seen workers left on the street as companies hide behind the protection of the courts in deemed insolvencies where fancy footwork and sharp practices are used to put assets beyond the use of redundant workers and other creditors. Those are assets that should normally be used to pay decent redundancies and moneys owed to small businesses. We have to be vigilant. After the debacle of Clerys, we said that the law would and should change to protect workers better in insolvencies.
The Duffy-Cahill report, entitled Expert examination and review of laws on the protection of employee interests when assets are separated from the operating entity, was brought to the Government in April 2016 but no action has been taken since. Now, 180 workers in Dundalk are in a desperately uncertain set of circumstances. They have not formally been made redundant and they are not legally entitled to the 30 day redundancy notice period to allow them work with their trade union on an enhanced or improved redundancy package. They have not earned any money since the plant closed and, despite the great support they have received from officials in the Department of Employment Affairs and Social Protection in the area, without a P45, entitlement to social welfare is moot. They also cannot or will not take up alternative employment because they hope that, somehow, IDA Ireland, Enterprise Ireland or other State agencies might find an alternative operator for the facility in Dundalk. In the meantime, life goes on, mortgages and rent need to be paid, bills need to be paid and families need to be fed.
The law needs to be changed. Does the Government intend to change the law as it applies to workers caught up in insolvencies like this? Will the Minister of State and his colleagues support the workers and the union in their efforts to seek social protection support for the workers and trade union members in that plant over the next short period?
I thank Senator Nash. I am taking this matter on behalf of the Minister for Employment Affairs and Social Protection, Deputy Regina Doherty. The Department of Employment Affairs and Social Protection received notification of the proposed liquidation of TAFC Manufacturing Ireland DAC on 22 October 2018.The Protection of Employment Act 1977 imposes a number of obligations on employers that are proposing collective redundancies, including an obligation under sections 9 and 10 to engage in an information and consultation process with employee representatives and to provide certain information in relation to the proposed redundancies. Section 11A of the Act provides that where an employee believes the employer to be in breach of sections 9 or 10, he or she may pursue a complaint to the Workplace Relations Commission, WRC. It is an offence under section 11 of the Act for an employer to fail to comply with sections 9 or 10. Following contact from the Department, the joint provisional liquidators of the company have advised that the consultation process with employees began on Friday, 19 October and will continue for 30 days. The Department will continue to engage with the provisional liquidators as required.
The Social Insurance Fund provides a safety net for the employees in cases of employer insolvency. It is the responsibility of the liquidator to seek, on behalf of employees, payment from the redundancy payments scheme in respect of statutory redundancy and from the insolvency payments scheme in respect of wage-related entitlements. An eligible employee is entitled to a statutory redundancy payment of two weeks' pay for every year of service, plus a bonus week. Compensation is based on the worker's length of reckonable service and reckonable weekly remuneration, subject to a ceiling of €600 per week. In order to qualify for a statutory redundancy payment, an employee must have at least two years of continuous service, be in employment which is insurable under the Social Welfare Acts and be over the age of 16. Entitlements covered under the insolvency payments scheme are arrears of wages, holiday pay, sick pay, payment in lieu of minimum notice and certain pension contributions. Payments are calculated by reference to an employee's wages and are subject to a limit of €600 a week. Arrears of wages, sick pay, holiday pay and minimum notice are limited to eight weeks.
The Department will ensure the affected employees receive advice on jobseekers' payments and other income supports that may be available to them. It will provide support to them on returning to work or accessing appropriate education and training and development options. Staff of the north-east division of the Department met employees of the company on Monday, 22 October to give them information on the Intreo services available locally. An information and recruitment event for the workforce will be held in the Crowne Plaza Hotel in Dundalk on Thursday, 1 November next. This event will be supported by other key service providers. Local employers with job vacancies have also committed to attend. The key message for employees is that the Department will provide any redundancy, insolvency and jobseeker payments to which they may be entitled in a timely manner and will proactively help them to access available opportunities for employment.
The WRC's customer service section provides information on the rights and obligations of employees and employers under employment rights legislation. WRC information officials are available to meet the staff concerned individually or collectively to discuss their employment rights, including matters related to redundancy.
I thank the Minister of State for his reply. Many of the details he has put on the record are available to the trade union and the staff. I reiterate my appreciation of the efforts made by the staff of the Department of Employment Affairs and Social Protection to assist workers who find themselves in a dreadful position. They were aware for some time that something was not right in this plant. As I said, efforts were made by the union to engage constructively with key decision-makers in the parent company in the UK. It is right that people are deeply suspicious about the circumstances around this. It is incredibly important for the Unite trade union to be represented at the formal liquidation hearing in the courts on 12 November to make sure there is a robust forensic examination of the relationship between the Dundalk company and its parent company in the UK. I have been told by workers and the trade union involved that some of the activities in the plant in recent months have left them very sceptical about the motivations of this company. In the meantime, there is a human cost. People do not have jobs or social welfare payments. They are wondering whether they should find alternative employment. People have bills to pay and children to feed. We are very close to Christmas.
The larger and wider issue at stake here relates to the point at which employment law and company law interact in this country.Nobody will ever forget the position in which Clerys workers found themselves in June 2015. We swore we would never again allow workers to be thrown on the side of the street without entitlements or security and not knowing what their entitlements were. We would no longer allow companies to use corporate restructuring and fancy footwork to avoid their obligations to employees and get away with this type of activity with absolute impunity. I produced the Duffy Cahill report which proposes some very strong measures, including, for example, to provide for a right to a minimum 30-day period of consultation for workers caught up in insolvencies, regardless of whether the firm was insolvent, and to introduce important sanctions on employers that refuse to comply with their obligations on the 30-day consultation period. Serious sanctions and disincentives need to be levelled at employers who engage in this type of activity. They expect to get away with this scot free and if the law goes unreformed-----
-----and unamended then they will continue to do so. While I understand that this is not the Minister of State's policy area or field of expertise, I would like to hear his view on the matter as a legislator and public representative.
Nobody wishes to see what happened to the Clerys workers happening again. I am not familiar with the case in Dundalk the Senator is raising. This is a matter for two Departments and is the responsibility of the Minister for Business, Enterprise and Innovation, Deputy Humphreys, and the Minister for Employment Affairs and Social Protection, Deputy Regina Doherty. I will raise the issue of the Duffy Cahill report with the former and the substantial issue of the lack of P45s and the fact that certain families do not have any source of income or access to social welfare payments with the latter. I will have the Ministers revert directly to the Senator.