John McGuinness (Carlow-Kilkenny, Fianna Fail)
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398. To ask the Minister for Social Protection further to Parliamentary Question No. 284 of 9 July 2013, the progress that has been made on this matter; and if employees concerned will be paid by her Department. [41026/13]

Joan Burton (Dublin West, Labour)
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The purpose of the insolvency payments scheme, which operates under the Protection of Employees (Employers’ Insolvency) Act, 1984, which, in turn, derives from EU Council Directive 987/80, is to protect certain outstanding pay-related entitlements due to employees in the event of the insolvency of their employer. These entitlements include wages, holiday pay, sick pay, payment in lieu of minimum notice due under the Minimum Notice & Terms of Employment Acts, 1973-2001, and certain pension contributions. Various other statutory awards made by the Employment Appeals Tribunal, Rights Commissioners, etc., are also covered by the scheme. Payments under the scheme are made from the Social Insurance Fund and the Minister becomes a preferential creditor against the assets of an employer in respect of most amounts paid under the scheme.

Where a person’s former employer was a limited company, the company should be in liquidation or receivership in order for the person to be eligible to claim under the insolvency payments scheme. In such circumstances, the liquidator or receiver becomes the relevant officer for submitting claims under the scheme as he or she has access to the company records and can certify that the amounts claimed are in order. I am aware that there are some cases where employers have ceased trading without engaging in a formal winding-up process. In some such cases, such as the one referred to in Parliamentary Question No. 284 of 9 July 2013, the company may have closed owing certain payments or statutory awards to its former employees.

The legislative position with regard to these types of situations continues to be reviewed with a view to establishing what, if anything, can be done to progress payments to individuals where no liquidator or receiver has been appointed.