Written answers

Wednesday, 1 June 2016

Department of Jobs, Enterprise and Innovation

Company Closures

Photo of Niall CollinsNiall Collins (Limerick County, Fianna Fail)
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227. To ask the Minister for Jobs, Enterprise and Innovation if sections 9 and 10 of the Protection of Employment Act 1977 were complied with in the closure of an organisation (details supplied); and if she will make a statement on the matter. [13982/16]

Photo of Mary Mitchell O'ConnorMary Mitchell O'Connor (Dún Laoghaire, Fine Gael)
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Authorised officers have sought information from a number of parties in relation to the collective redundancies that took place on 12 June 2015, pursuant to the appointment of a provisional liquidator to OCS Operations Limited. The work of the authorised officers relates to the application of the Protection of Employment Act 1977 (as amended) to the collective redundancies in question. That Act imposes a number of obligations on employers who are contemplating collective redundancies, including an obligation to consult with employees (section 9) and an obligation to provide certain information to employees for the purpose of section 9 consultations (section 10). The work of the authorised officers is ongoing. In this regard the Deputy may be aware from media reports that one of the parties from whom the authorised officers sought information initiated proceedings in the High Court challenging the powers of the authorised officers. The High Court is due to consider the matter further on 7 July.

On a separate note, the Deputy may be aware from media reports that in July 2015 over 60 former Clerys workers, represented by their respective trade unions SIPTU and Mandate, made complaints to the Rights Commissioner Service under the Protection of Employment Act 1977 (as amended) and that in January 2016 they were awarded compensation by a Rights Commissioner in respect of their complaints. The Rights Commissioner Service was under the auspices of the Labour Relations Commission, prior to the establishment of the Workplace Relations Commission on 1st October 2015. The service acted independently in the exercise of its quasi-judicial function. Hearings heard under the auspices of a Rights Commissioner were heard in private, and in accordance with the relevant legislation their decisions or recommendations were issued to both parties and/or their representative(s), but were not published.

Photo of Niall CollinsNiall Collins (Limerick County, Fianna Fail)
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228. To ask the Minister for Jobs, Enterprise and Innovation if sections 224, 599, 608 and 621 of the Companies Act 2014 were complied with in the closure of an organisation (details supplied); and if she will make a statement on the matter. [13983/16]

Photo of Mary Mitchell O'ConnorMary Mitchell O'Connor (Dún Laoghaire, Fine Gael)
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The duty of directors under section 224 of the Companies Act 2014 is owed to the company and the company alone and is enforceable in the same way as any other fiduciary duty owed to a company by its directors. The mechanism for the enforcement of directors’ fiduciary duties is through a court action.

Section 599 of the Act provides that, on the application of the liquidator or any creditor or contributory of a company that is being wound up, the court, if satisfied that it just and equitable to do so, having regard to the provisions of the section, may make an order that a related company contribute to the debts of the company being wound up. I understand that the Minister for Social Protection is currently considering how the provisions of the Companies Act 2014, including section 599, might be used to recover the moneys expended from the Social Insurance Fund. My Department is not a creditor of the company concerned and would have no locus standi in this regard.

Section 608 confers a power on the court, again on the application of the liquidator or any creditor or contributory of a company that is being wound up, to order the delivery of property or the proceeds of sale of property to the liquidator. My Department is not a creditor of the company concerned and would have no locus standi to bring an action in this regard.

The liquidator has a duty under section 624 to administer the property of a company to which he or she is appointed. This duty includes the realisation and distribution of the assets of a company in accordance with law. Section 621 sets out the order of priority of payments of debts in a winding up. The section provides that each type of debt ranks equally among itself and, where the assets of a company are insufficient to meet such debts in full, the debts abate in equal proportions. The liquidator in a winding up by the court is an officer of the court.

Ultimately it will be a matter for the court to determine in any particular case brought before it if the relevant law has been complied with.

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