Written answers

Thursday, 17 May 2018

Department of Employment Affairs and Social Protection

Insolvency Payments Scheme Payments

Photo of Tom NevilleTom Neville (Limerick County, Fine Gael)
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249. To ask the Minister for Employment Affairs and Social Protection the status of the review of eligibility for the insolvency payments scheme; and if she will make a statement on the matter. [21837/18]

Photo of Regina DohertyRegina Doherty (Meath East, Fine Gael)
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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.

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 can be situations whereby employers have ceased trading without engaging in any formal wind-up process and some or all of their former employees are left with money owed to them. Such people are not covered by the insolvency payments scheme.

The Department is continuing to review the position to establish what, if anything, can be done to progress payments to individuals in situations where employers cease trading without engaging in a formal winding-up process and owe moneys to their employees. The Department is consulting a range of interested parties, including the Office of the Director of Corporate Enforcement, the Department of Jobs, Enterprise and Innovation and the Revenue Commissioners, in respect of these issues.

In this regard, it is important to note that there are very difficult legal issues arising in insolvency law and the potential impacts that any proposed policy development might have on company law generally have to be considered.

I am not in a position to indicate at this stage when the review will be completed as there are still some legal cases before the courts.

I hope this clarifies the matter for the Deputy.

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