I move:
That leave be granted to introduce a Bill entitled an Act to amend the Companies Act 2014 to hold a company officer or officers acting on behalf of a corporate body personally liable where a breach of employment law is committed.
I will outline briefly the purpose of the Companies (Amendment) Bill 2015, which amends section 224 of the Companies Act 2014. In short, this Bill provides for a piercing of the corporate veil to hold unscrupulous employers to account and protect vulnerable workers. When used by a few rogue employers, the corporate veil separates the legal personality of a company from its directors, thus protecting them from liability for the business's obligations to its employees in cases of tactical insolvency. This Bill has a particular eye on employers who shirk their responsibilities to their employees by establishing a number of companies to break the link between assets and employees.
Over the past number of years, there have been a number of high-profile company closures in which workers have had to resort to sit-ins or strike action in an effort to claw back unpaid wages and access redundancy and other entitlements. These are entitlements for which they have already laboured and provided a service. The examples are well known - the Paris Bakery, Vita Cortex, La Senza, HMV, Game, Thomas Cook and Connolly Shoes, and in my constituency, the Darnley Lodge Hotel.
We have had much tea and sympathy from the Government. I have witnessed Labour Party Ministers, in front of Leinster House, with staff from the Paris Bakery gathered around - people who were in a serious situation in which they could not live on a day-to-day basis - say they would go back into the Oireachtas and do all within their power to make sure this did not happen again. But despite this tea and sympathy, the Government has taken no concrete action to address the legal protections that these rogue employers currently enjoy.
I and other Opposition Deputies have repeatedly raised with the Minister, Deputy Bruton, and at committee meetings the problems associated with tactical insolvencies and the corporate veil legal protections that are enjoyed by a small number of rogue employers, but to no avail. I even submitted a rack of amendments to Government legislation in the hope that the Minister and, indeed, his Labour Party Cabinet colleagues would deal with the shortfalls of the existing principle in company law that a director's duties are owed to the company and not to his or her employees.
Existing company law is deficient as it facilitates such employers in building paper walls within entities or creating multiple entities with the specific intent of separating assets and goods from the legal entity that employs the staff. It is not acceptable for us as legislators to simply sit on our hands and speak of principles, as if the existing law is some sort of immovable feast. Indeed, many are involved in sit-ins for months as they find it impossible to feed their children, heat their homes and pay their rent or mortgage. People are being pushed into poverty by this issue.
Employers who adversely use the protection of the corporate veil principle are also undermining the vast majority of decent employers who uphold their responsibilities to their staff, and are adding a cost to the State's already overburdened industrial relations mechanisms. Any decent employer in the State who fulfils his or her responsibility to employees will have nothing to fear from this Bill. Such employers will incur no cost from it. This Bill seeks only to chase those who stuff the employees who have worked for them for years.
There are limited instances in company law in which a director, a shareholder or a financial institution can take an action against another director of a company where he or she is in breach of his or her duty, causing damage to the company. There is no similar provision in employment law to protect workers.
To date, the Government has failed to put any proposal on the legislative table to deal with abuse of the corporate veil. We are in the dying days of this Administration and it is quite unlikely, if it starts a project, that it will bring it to full implementation before the next general election. There is time pressure here. That is why I would appeal to the Government, especially the Labour Party members, to take this Bill on board. They should allow it to proceed through the Oireachtas so that we can discuss it and maybe, if necessary, amend it, but we should get the objective fulfilled.
I introduce this Bill in the hope that it might serve as a starting point for action by this Government. It is Sinn Féin's strong view that vulnerable employees need this protection and that rogue employers must be held to account.
