asked the Minister for Labour whether he is satisfied that workers' interests are adequately safeguarded in the case of mergers and takeovers.
Ceisteanna—Questions. Oral Answers. - Mergers and Takeovers.
30.
I am satisfied that, generally speaking, the rights of workers in mergers or take-overs are protected but, of course, it is difficult to be totally satisfied in relation to matters of this kind. Instances can arise, for example, even where legal safeguards exist and are technically observed, but workers are not treated as fairly as they might be in situations of changes of ownership of their employers' business.
So far as the legal position is concerned, the Deputy will probably be aware of the provisions of the European Communities (Safeguarding of Employees' Rights on Transfer of Undertakings) Regulations, 1980, which give effect to an EEC directive relating to workers' rights in merger or take-over situations. These regulations provide that where a change of employer occurs the rights and obligations arising from an employment contract are transferred from the original owner to the new owner.
In relation to redundancy payments to workers affected by mergers or take-overs, there are special provisions in the Redundancy Payments Acts relating to take-overs or transfers of business. These provide that an employee must be paid his statutory redundancy entitlement by the first employer unless the second employer undertakes responsibility for the employee's service with the first employer. In the event that the employee is made redundant by the new employer at some later date, his full entitlement would then be the responsibility of the new employer.
Moreover, in cases where the take-over is due to the insolvency of the first employer, the provisions of the Protection of Employees (Employers' Insolvency) Act, 1984, apply. This ensures that in an insolvency situation certain employment-related contractual entitlements which the insolvent employer is unable to pay are protected by the Act. The protected entitlements include arrears of wages, holiday pay, sick pay, minimum notice awards and unpaid contributions to occupational pension schemes within certain limits.
There is, therefore, a combination of legal instruments which afford good protection to workers affected by mergers or take-overs. I acknowledge, however, the difficulty of providing for every possible contingency situation.
My Department will be prepared to assist in any way possible in resolving any problems that may arise from employees in particular cases that are brought to notice. It will be understood, though, that it would not be feasible for the Department to give authoritative legal advice on issues arising. These can only be decided by the courts.
I am grateful for that comprehensive reply. Will the Minister agree that there is considerable disquiet that in a series of fairly recent takeovers, some in insolvency situations and some otherwise, the interests of workers seem to have come a very poor second to the interests of creditors, contributors and others? Specifically in the case of insolvency, will the Minister accept that liquidators have tended to regard their responsibilities under the Insolvency Act as being a lesser priority than some of their other duties and that the effect has been that people have been delayed in getting their entitlements? Will he take steps through his Department officials to impress upon liquidators the responsibility that rests on them to address this question if people are to get their statutory rights?
I agree with what the Deputy has said. There has been some concern in this regard. Without naming any of the companies, some of them have been raised in Private Notice Questions in this House in the last month or so. It is a highly complex area and I will certainly raise the matter with the officials in my Department. I know from recent examples that they were not slow to point out to the liquidators the concerns and the protections that should be in place for employees.
I must go on to other business. We have overspent our time on questions for priority.
In relation to a Private Notice Question that I tabled and which you dissallowed, and which I accept I cannot now challenge, the reason the different approach was taken on Question No. 15 was that I tabled questions today in regard to the arrest, release and re-arrest of a person in Cavan; you ruled that out of order on the basis that it was sub judice. I tabled a question arising from certain allegations that were made in the course of an employment appeals tribunal and you allowed the question to appear on the Order Paper but did not allow supplementaries to be put. Could I suggest to you, a Cheann Comhairle, that the proper course of action in relation to my Private Notice Question would have been to allow me put the question but not to allow me put any questions that would have touched on the offence which was charged.
I have already ruled on that matter and I am not going to argue with the Deputy now.
As I understand the position——
Deputy Birmingham, resume your seat.
May I just make one comment?
No, Deputy, you may not.