Written answers

Tuesday, 9 December 2014

Department of Jobs, Enterprise and Innovation

Insolvency Payments Scheme Payments

Photo of Joe HigginsJoe Higgins (Dublin West, Socialist Party)
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204. To ask the Minister for Jobs, Enterprise and Innovation the recourse available for persons (details supplied) to have their successful claim for unpaid wages against their former employer enforced; and if he will make a statement on the matter. [46853/14]

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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Under the provisions of Section 8 of the Payment of Wages Act 1991 a Rights Commissioner’s decision may be enforced as if it were an order of the Circuit Court. A formal request for such an order may be filed in the County Registrar’s office by the person seeking the order. NERA has no powers of enforcement under the Act. The purpose of the insolvency payments scheme, which operates under the Protection of Employees (Employers’ Insolvency) Act, 1984, 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. My colleague, An Tánaiste and Minister for Social Protection, Joan Burton, has responsibility for the administration of the payments from the insolvency payments scheme.

Where a person’s former employer was a limited company, the company must 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 as he or she has access to the company records and can certify that the amounts claimed are in order.

There are companies which cease trading without engaging in a formal winding-up process and in some such cases those employers may owe monies to their employees. Such employees are not eligible for payments under the insolvency payments scheme. I am advised by the Department of Social Protection that the company in this instance is not in liquidation or receivership and therefore the awards cannot be submitted for payment to the insolvency payments scheme.

I am informed that the Department of Social Protection is currently reviewing the position to establish what, if anything can be done to progress payments to individuals in these situations. The Department of Social Protection is not in a position to indicate when this review will be completed.

Photo of Seán FlemingSeán Fleming (Laois-Offaly, Fianna Fail)
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205. To ask the Minister for Jobs, Enterprise and Innovation his views on introducing a mechanism whereby persons due money under the Payment of Wages Act 1991 and the payment is not forthcoming from the former employer, payments due under this act can be paid in line in a similar fashion as to when the State pays the statutory redundancy to a company that pleads inability to pay; and if he will make a statement on the matter. [46925/14]

Photo of Richard BrutonRichard Bruton (Dublin North Central, Fine Gael)
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The Payment of Wages Act, provides that an employee can pursue a claim in respect of any particular unlawful deduction or payment before the courts, or before a Rights Commissioner, but not before both. If the employee chooses to pursue their claim before a Rights Commissioner, the employee may appeal the Rights Commissioner decision to the Employment Appeals Tribunal (EAT), with the possibility of appealing the determination of the EAT to the High Court on a point of law. Under the provisions of section 8 of the Payment of Wages Act 1991 a Rights Commissioner’s decision on a determination of the EAT may be enforced as if it were an order of the Circuit Court. A formal request for such an order may be filed in the County Registrar’s office by the person seeking the order. NERA has no powers of enforcement under the Act.

Work which I am currently undertaking on the reform of the State’s employment rights and industrial relations structures is at an advanced stage. Provision has been made in the Workplace Relations Bill 2014 for a range of enhanced compliance measures, including the use of Compliance Notices and Fixed Payment Notices. The Bill also makes provision for the introduction of a more effective and streamlined system for the enforcement of awards from WRC Adjudicators and/or the Labour Court under employment rights legislation via the District Court. I am satisfied that these new compliance and enforcement measures will provide for more proportionate, efficient and effective enforcement of employment law.

As the Deputy is aware, my colleague, An Tánaiste and Minister for Social Protection, Joan Burton, has responsibility for the Redundancy Payments Acts 1967-2014 and the Protection of Employees (Employers’ Insolvency) Acts. The latter deals with situations where the employer is insolvent. I am informed that the Tánaiste has no plan at present to consider extending the insolvency payment scheme to cover payments due by employers who continue to trade.

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