Seanad Éireann debate -
Thursday, 1 May 1986

Vol. 112 No. 6

Report of Joint Committee on the Secondary Legislation of the European Communities — Fifth Company Law Directive: Motion (Resumed).

Debate resumed on the following motion:

That Seanad Éireann takes note of Report No. 20 of the Joint Committee on the Secondary Legislation of the European Communities: Fifth Company Law Directive.

—(Senator Dooge.)

Mr. Fitzsimons

I will facilitate the House and confine my contribution to not more than 20 minutes to facilitate the other two Members who want to contribute.

Some of the preliminary remarks I made with regard to the Vredeling report on the last occasion apply equally well, I feel, in this situation. It is a very specialised area, an area in which I do not have any great expertise, and I feel that to make a meaningful contribution it would be necessary to have experience of some kind in that area or to have made a special study of that area.

With regard to the Minister of State, Deputy E. Collins, I felt that his contribution on the last occasion was very succinct and positive and I want to put on record that I am grateful to the Minister for letting me have the text of his speech. It is no harm to state at the start of my contribution the basis for this recommendation. It relates to Article 54.3(g) of the Treaty of Rome. It is not very lengthy and I would like to quote it: Article 54.1 states:

Before the end of the first stage the Council shall, acting unanimously on a proposal from the Commission and after consulting the Economic and Social Committee and the Assembly, draw up a general programme for the abolition of existing restrictions on freedom of establishment within the Community. The Commission shall submit its proposal to the Council during the first two years of the first stage.

Section 3 states:

The Council and the Commission shall carry out the duties devolving upon them under the preceding provisions, in particular:

Paragraph (g) states:

by co-ordinating to the necessary extent the safeguards which, for the protection of the interests of the members and others, are required by Member States of companies or firms within the meaning of the second paragraph of Article 58 with a view to making such safeguards equivalent throughout the Community.

Article 58 states:

Companies or firms formed in accordance with the law of a Member State and having the registered office, central administration or principal place of business within the Community shall, for the purposes of this Chapter, be treated in the same way as natural persons who are nationals of Member States.

"Companies or firms" means companies or firms constituted under civil or commercial law, including co-operative societies and other legal persons governed by public or private law, save for those which are non-profit-making.

I would not be doing an injustice to Minister of State, Deputy Collins, with regard to his contribution if I said quite bluntly that he poured cold water on the directive. I think that would be a reasonable conclusion. In the light of his analysis of the situation I would have to agree with that conclusion. The conclusion is summarised very neatly towards the end of his speech and I would like to quote it. He stated:

... there is no broad demand in this country for the proposals, which are based on Continental European law; second, the proposals would not, in many instances, suit the Irish situation; third, the proposals would cause major disruption of current management practices; fourth, some of the proposals may prove to be too cumbersome for the smaller plc's; fifth, the proposals could slow down the decision making process and could adversely affect the competitiveness of Irish industry with a consequent adverse effect on employment; and finally, the proposals could affect the level of investment in Irish industry ...

That is clearcut and straightforward. With regard to the committee's conclusions, I think that, broadly speaking, they will be somewhat similar.

The committee came to the conclusion that some degree of co-operation was necessary between employees and employers. It is fair to say when dealing with this report that in my view we are dealing with the employer aspect whereas with the Vredeling report we were dealing more or less with the employee situation and consultations in that area.

On paye 14 of their report, the joint committee stated that it:

... acknowledges the importance of proceeding in this area by way of a Council Directive and broadly speaking it would accept the proposals of the draft Directive as providing a legislative framework within which both sides of industry would be encouraged to find agreement.

Reservations are expressed throughout the report and in my brief contribution I hope to refer to these.

I would also like to pay tribute to all the members of the joint committee, 18 Deputies and seven Senators, and being a member myself of an Oireachtas Joint Committee I know the onerous work involved and I know the problem there is in attending the different meetings and finding the time. I had that problem yesterday with the Joint Committee on Women's Rights. Therefore, I want to pay a tribute to all the members and a particular tribute to Senator Mary Robinson who chaired the subcommittees.

The Fifth Directive was published in August 1983. The proposed directive is one of a series of ten dealing with company law, several of which have already been adopted by the Council of Ministers and of which two have been implemented by Irish legislation. The report gives details of the area that has been amended. One is the Companies (Amendment) Act, 1983, and the other is the Companies (Amendment) Bill, 1985. It also lists the other areas which have still to be taken under statute law. This means a very heavy workload in the immediate years ahead to catch up on this situation. One could ask why only two have been implemented in that space of time. One of them goes back to 1968, the Council Directive on the Disclosure and Validity of Obligations and Nullity of Companies. Another one goes back to 1978. It begs the question as to why these have not already been implemented.

Since the appearance of the proposed Fifth Directive in its original form in 1972 it has been the subject of controversy. From the debate here it is easy to see that this controversy is going to continue. There are two conflicting interests trying to find a common goal. The overall feeling of the committee is that some common ground must be found and that it is possible to find that common ground. It goes back to 1972. At that time we had only six members in the Community; since then this number has been doubled, which has also brought problems. We had the revised version of the directive which appeared last year. It incorporates many of the suggestions of the European Parliament which adopted an opinion on the original proposal in May 1982 and presumably brought it up to date as regards the feelings of the other member states who joined since 1972.

The revised version has been under examination by a Council working group since December 1983 and it is expected that consideration at this level will take considerable time. Obviously, it will take some time to find that common ground. When this Government are making an input in this area with the feedback from Ireland towards this directive, I wonder will the contributions in this House be taken into consideration, I wonder will the feelings of individual Members or the general feeling of the House be put forward. I hope they would be.

It is important to pay tribute to all the organisations which made submissions to this committee — the Federated Union of Employers, the Federation of Irish Industry, the Consultative Committee of Accountancy Bodies, Ireland, the Irish Congress of Trade Unions, as well as the Department of Industry, Trade, Commerce and Tourism and the Department of Labour. These are the same organisations that made submissions for the Vredeling report. Before we discussed the Vredeling report a decision was made that it would be better to discuss these reports independently. With my limited knowledge and the information I have gained since then, I think a good case could have been made to discuss both reports together. Many of the suggestions made in this report also relate to the Vredeling report, in particular the threshold of 1,000 employees. This applies to both. So, we are dealing with large companies, although in situations where we have smaller subsidiaries in different states I suppose the cumulative numbers will apply rather than the different subsidiaries.

The draft directive contains a number of significant proposals dealing with the structural functions of companies and other issues within the area of company law which would apply to all public limited companies. For that reason I believe it is a very specialised area. When we come to deal with the structure and function of the board as suggested by the directive, I think we are in one of the most complicated of the specialised areas because we are dealing with suggestions for a two-tier basis. The report tells us that if the proposed directive is adopted it would be necessary to enact national legislation so as to enable public limited companies to be organised on a two-tier basis, with a management organ responsible for the running of the day-to-day affairs of the company under the supervision of a supervisory organ.

The significance of a two-tier system is that the supervisory section is separate from the management. An alternative to the two-tier system is allowed. This is the one-tier system in which the management and the supervisory members would be incorporated in the one system. Employee participation is covered very well. The proposed directive sets out a number of options for employee participation and supervision of the management of a company in all areas.

This is a very comprehensive part. The provisions relating to employee participation apply only to public limited companies employing 1,000 or more people. In calculating that figure it is allowable to include the subsidiary groups. This is a proviso which can be accepted or rejected by the parent company.

I also note in the report that it is possible for the subsidiary sections to adopt or reject the rules which related to the parent company and to draw up a code of rules of their own. This was referred to also in the Vredeling report. It is a difficult area. The committee came to the conclusion that a legislative basis is essential. While a voluntary code would be recommended it is most unlikely without the legislative basis that anything worthwhile could be achieved or decided on.

The Minister dealt very well with the problems related to the directive and Irish law. The committee came to the conclusion that the directive contains a number of significant provisions dealing with a wide range of conventional company law issues which are at variance with the more stringent laws, and they are more stringent than existing Irish law and practice, while some few were less demanding. If it is adopted in its present terms the directive will necessitate the amendment of the Company Acts, 1963 to 1983, which for any Government would be a major undertaking. Regarding the structure and functions of the board and the comparison of the two-tier systems, the Minister has pointed out very well that the two-tier system is based on German practice and the position in the Netherlands in 1972.

It is argued in the directive and by those who are in favour of it that it is the structure which offers the most satisfactory safeguards for shareholder and employee interests. Companies will have the option of adopting the one-tier system, and the revised draft envisages that companies would have this right. This is really Hobson's choice, because we are told in the report that they would never be obliged to accept the formal division of management and supervisory functions which differentiate the two-tier system as against the single one. While on the surface they seem to have that choice in reality they do not have a choice, because the essential feature of the two-tier system must be implemented in any event.

The two-tier system is the one which in various forms applies in Ireland. The board of directors is appointed by and answerable to the shareholders at the general meeting. The Minister had extreme reservations with regard to the conditions which apply to the annual general meeting. In the event of some omission of a technical or inconsequential nature the annual general meeting could be declared null and void. That would be a most unsatisfactory situation. With my limited knowledge of company law, it would have to be gone into in much greater detail with regard to the two systems and the obligations of companies with regard to the systems and the options which they would have in reality.

As well as the Minister having reservations about the directive, those involved on the employer side have also had reservations. The Federated Union of Employers and the Confederation of Irish Industry are opposed to the imposition of a two-tier system. Both of them consider that the two-tier system would lead to confusion and delay when the need is for flexibility and flair in adapting to changing circumstances. The Department of Industry and Commerce do not see any particular merit in a two-tier system or in the formal separation of functions in a one-tier system and consider that considerable changes would be required in current management functions by the mandatory imposition of either.

While the directive has been largely revised and amended since it was initiated in 1972, it seems that much greater amendment is necessary to make it more flexible, certainly as it would apply to Irish conditions. In this House we are mainly concerned with the conditions here and we would be apprehensive regarding the views of the committee that in some ways implementation of the directive in its present form could result in discouraging outside firms who might be thinking of coming here. We would have to guard against that.

The committee took the view that employee participation is important. This, one could say, compares with marriage. It is a twin-engined machine and both engines have to be functioning properly to make it work. This applies very well here. The employees and the employers are important. They are both indispensable. On that basis the approach should be made to try to resolve the problem to satisfy the conditions in this country.

The committee stated categorically that traditional patterns in this country with regard to company law would have to be changed and that the laws relating to companies would have to reflect the change of underlying philosophy and include provisions expressly dealing with relationships between providers of capital and the management of employees. That underlines the point I was trying to make.

I will curtail my contribution in order to facilitate the other Members who want to contribute. I will not go into some of the other aspects of the matter I had intended to bring up. I was very impressed with the contribution the Minister made. In motions of this kind the usual procedure in this House is that the Minister replies at the end. If we were to compare one method with the other there is a lot to be said for that method. Yet by coming in at that stage the Minister gives a clearer picture from his expertise and from his greater knowledge. In this situation he helped me in formulating my views with regard to the situation. Broadly, I see that employee participation is needed. Provision will have to be made for that and I would agree with the Minister that it should be made within the context of helping the situation as regards industry and employment in this country. I thank all the members of the committee and I welcome the report.

Mr. McDonald

This report falls into quite an unusual category. Generally reports are welcomed and they reflect the positive views of the members of the committee. This report is a result of very painstaking work undertaken diligently by Senator Robinson, the chairperson of the subcommittee, and members of that committee. The directive the report is based on is one that does not appeal to a considerable cross-section of the people to whom I have spoken. Since we joined the EC, since the mid-seventies, there has been an amount of social industrial legislation. Looking back over the last eight years it is not too clear whether a lot of that was particularly suitable to the Irish mentality or to the prevailing situation in this country. I do not think one could say all that legislation had combined to provide either additional job opportunities or greater profits. Yet, it represents an advance on the conditions in the work place.

Much of this legislation, although entirely desirable, should be balanced very carefully with the situation that its implementation will bring about. As far as this Fifth Company Law Directive is concerned, the Federated Union of Employers and the Confederation of Irish Industry are opposed to the imposition of a two-tier system as envisaged by this directive. Both considered that a two-tier board would lead to confusion and delay when the need is for flexibility and flair in adapting to changing circumstances. Indeed, the Department of Industry and Commerce do not see any particular merit in a two-tier structure, or in the form of separation of functions in a one-tier system, and considers that a considerable change would be required in current management functions by the mandatory imposition of either.

The joint committee thought that the separation of management and supervisory functions is necessary, at least in the Commission's view, to strengthen the shareholder control of management and also to facilitate employee participation in the decision-making process at company level. The joint committee are not satisfied that a formal separation of functions would have any particular advantage over the present system for this country as far as the management and control of companies is concerned. As the report says, the question then arises whether such separation of functions would facilitate the introduction of employee participation in decision making if such is considered desirable. The separation of supervisory and management functions might open the door to participation by employees in the former. The committee noted that, not surprisingly, the development of participation in relation to decision-making bodies is most advanced in countries where the dual system operates.

The main thrust in this country should be towards the expansion of industry in an effort to provide for the large number of people who are unemployed and to provide interesting and remunerative job opportunities for the large number of suitably educated young people coming on the the labour market each year. I believe that every effort should be made to endeavour to make it easier for employers to take on more young people. We have not been able to strike a balance between the interests of the employees and the industrialists. I do not mean those people who are trained and who are well established. Employers are very apprehensive sometimes about taking on new recruits or young people. They cite, sometimes very unfairly, the social legislation which makes it more difficult for them to let people off or to change. I should like to see some better system introduced whereby it would be possible to have an expansion of the AnCO type training courses more closely related to ordinary industrial operations. We should try to get back to something more akin to the apprenticeship situation that we had. I do not mean that we should reintroduce the apprenticeship type remuneration that we had in this and other countries for far too long. Young people should have more flexibility in finding an niche for a career. I do not think it is good enough that people should be steered into a particular type of industrial employment and not given an opportunity of experiencing other types of related industrial work.

I share the view of the Department of Industry and Commerce who have expressed some opposition to this directive. I also feel that the Confederation of Irish Industry and the Federated Union of Employers have made the point very clearly as far as this company law directive is concerned. Some are inclined to think that each piece of legislation that emanates from Europe should be accepted and implemented. There needs to be greater energy directed towards altering and tailoring these directives to fit into the Irish situation in a positive way. Each directive should be adopted only if it makes a positive contribution to employment, to the quality of life for people who are employed and to the profitability of industries.

Mrs. Robinson

I welcome the opportunity to contribute briefly to the debate on this report. As has already been mentioned, this report is, in effect, linked to the report on the proposed Vredeling Directive which we debated in this House last week. Like Senator Fitzsimons, I believe it might have been helpful if we could have debated them together. However, they do fall within the responsibilities of different Ministers and it was decided to take them separately in this manner.

I feel that the linkage is not only because of the question of employee participation. It is also possible to note that the two proposed directives have had a somewhat similar progress, or rather lack of progress, at the European level. Like the so-called Vredeling proposal for a directive, this proposal for a Fifth Company Law Directive has been around for a long time. It was first put forward as a draft proposal in 1972, before Ireland joined the European Community. The draft which the joint committee considered was a substantially revised draft which was put forward in 1983, following not only the extensive examination and views of the European Parliament Economic and Social Committee, but also following a process which the Commission instituted of having a Green Paper on Employee Participation, which examined the company law system and the extent to which there was employee participation in the different member states. They discussed the various models which existed. They discussed the issues which arose and invited comments on that. Therefore, there has been a very considerable amount of discussion at the European level.

I agree with the view expressed by the Minister and by others that this is quite a radical proposal, but I am somewhat disappointed at the tone of the Minister's contribution to this debate. He appears to be very reluctant to embark on the particular values which lie behind this directive and to be concerned in a defensive way about the implications without addressing some of the problems which we have at the moment under our existing company law.

We have very real problems. We have had some extremely bad experiences with large companies in recent years. We should ask ourselves if we are entirely happy with our industrial relations with our company law structure with participation by employees such as it may be. The approach of the joint committee, in the report as adopted, is more positive in relation to the Fifth Company Law Directive than my reading of the Minister's contribution. I have to confess that I read the Minister's speech, I was not present when he delivered it. Sometimes one can read a more negative attitude into the written word than might have been present in the Minister's tone of voice. He appeared to see difficulties in Ireland accepting either the separation of the functions, and not necessarily the separation of the two-tiered board proposed in the company law structure part of it, but equally in the employee participation which is envisaged in that new company structure.

I would like to come back to the approach of the joint committee and argue for very serious consideration of this measure of company law reform. I would take the point made by Senator McDonald. It is important that in looking at proposals from the European Community that we scrutinise them very rigorously and that we do not just accept them because they have been proposed from Brussels, that we ensure that what is envisaged does, either when drafted or when amended, improve and fit the Irish context. I believe the values implicit in this proposal are something of merit to the development of company law and employee participation in Ireland. In other words, I would urge the House to accept what is the more positive approach of the joint committee in this report and to seek more rapid progress at Community level in this proposal for a Fifth Directive in Company Law.

It is not necessary to go into detail at this stage in the debate on the scope of the proposals. Although there is a clear distinction between the part of the directive which is dealing with the structure and functions of the board and the provisions in relation to employee participation there is obviously a clear linkage between them.

The revised proposals — I am taking three proposals — in relation to the structure and functions of the board are much more flexible. This can be done in the context of a one-tier board. It can be fitted into the company law tradition which we have. We have to ask ourselves if we are satisfied with performance by company boards, whether we are satisfied that our present structure is adequate. Serious questions arise, particularly in the light of some of the extremely bad experiences we have had with large companies in recent years.

The distinction between the functions of supervision and management is a very clear and logical one which need not and is not intended to become a bureaucratic and dead hand on a company. It is not intended to prevent the kind of flexibility which would allow a company to engage in rapid decision making but it would be a clear identification of and taking responsibility for these separate functions.

Equally, in relation to the other main pillar of this proposed directive the actual proposals in relation to employee participation have become much more flexible because, as is set out in paragraph 6 of the report, there are various options in relation to employee participation. A member state may adopt whichever of the options would be most suitable to the particular tradition. What was most striking to the members of the subcommittee who heard representations from both sides of industry and from the Department but particularly from the two sides of industry on this measure, was that the representations made echoed very much the representations made in relation to the Vredeling Directive. There were totally opposing views on the merits of the directive from both sides. The union side were not only advocating support for employee participation as envisaged here but also criticising the watering down of this directive. From the FUE and CII there was opposition to a measure which they saw as bringing a degree of inflexibility, bureaucracy and potential unattractiveness for industrial location in Ireland. Certainly as the person who chaired the two subcommittees dealing with these reports, I can say it calls us to consider attitudes to the running of companies here, to the assumption of responsibility in relation to that running, above all perhaps to accountability for the actions of those who have that responsibility. There did not seem to be an openness to considering the underlying values and to really examining whether there would be an improvement in relation to the area of industrial relations.

It is clear in the report, when you come to the views of the joint committee, which are inserted separately in relation to the board structure, separation of the supervisory and management functions and the section in relation to employee participation that the joint committee favour the introduction of these developments into our company law, that with some amendments we would support the adoption of the Fifth Company Law Directive. In that regard the joint committee had the opportunity to assess the kind of considerations which were advanced in relation to the directive and, in particular, the viewpoint put forward in relation to employee participation. There did not appear to be any faith in the greater involvement and sharing of responsibility by employees improving the management and working of the company. This is encapsulated in the view expressed by the Confederation of Irish Industry which is referred to at paragraph 21 of the report and states:

The Confederation of Irish Industry has expressed the opinion that "the unity board structure containing representatives elected by shareholders and employees would tend to promote conflict rather that consensus in the board room".

That is a statement which bears examining. It says much about pre-conceptions. If it is accurate, then we should be very concerned about it. If it is not accurate, then it appears to be an extremely defensive approach to the possibility of reform.

The view of the joint committee on that point was a very different one. It was more in line with the view expressed by the Minister for Labour in 1980 in the context of the Government's discussion paper on worker participation where the contrary belief was expressed as follows:

That workers' involvement will help to reduce the tensions which very often lead to industrial strife.

That is the approach which the joint committee endorse and adopt in relation to this problem.

The Minister made it clear at the end of his speech to this House in the debate which commenced last week that the proposal for this draft Fifth Company Law Directive is under consideration and is receiving, in effect a slow First Reading at Community level. He envisages substantial changes before the matter will be finalised at Community level.

It is regrettable that the proposal has not generated more active debate in Ireland about employee participation. It is significant that neither the Government's White Paper which was issued in 1980, nor this proposal for a Fifth Company Law Directive has generated that debate for reasons which do not reflect that well on either of the social partners in an institutional sense. We do not have a healthy debate about democracy in the work place, democratic decision making, accountability and assumption of responsibility in relation to the operation of companies.

The worries expressed by the Minister in his speech about the implementation of the directive being a possible deterrent to location of industry here is not really borne out by the facts of the case. If the Fifth Company Law Directive is passed at European Community level, then it will have to be applied in the 12 member states of the Community. It will become the norm in the European Community.

The advantages for companies outside the Community in having a company established within the EC and having access to the huge Community market far outweigh technical considerations in relation to how particular proposals for company structure will work. It is of enormous advantage to the Japanese, the United States and to other third countries to locate and operate within the EC.

We would be competing on equal terms with our Community partners in that regard. It is difficult to see how it would prejudice us in that respect. I believe what we would have to gain is significant. We would gain company law structure and involvement by employees which would bring about a much healthier relationship of identification with the company or enterprise and with decisions in relation to future development of that company or enterprise. It would require on the management side a greater accountability and involvement of, and consideration for the interests of employees in that development. Given the state of company law development and indeed the problems in recent years in Ireland, this would be very healthy and welcome indeed.

Perhaps it may be a question of which Department deal with a measure. I tend to be of the view that if the Minister who had responsibility for this proposed directive, had been, for example, the Minister for Labour — I am not talking about personalities here but about the viewpoint of a Department — advised by his officers in the Department of Labour, there might have been a great deal more enthusiasm for the thrust of the directive. I certainly hope that at Community level we will not be stalling on progress in that regard and that we will have more courage in our convictions, that the values in this directive are worth moving ahead with, that it may need some amendment and modification to make it fit the Irish system but that we have a lot to learn and gain from the kind of thinking behind this proposal and its adoption.

Mr. Hourigan

I would like to compliment the chairperson of the subcommittee, Senator Robinson, and the other members of the subcommittee for producing such an excellent report before us today on the vital question of worker participation either in the EC context or in an Irish context. It is very much in accord with the broad points of the Vredeling Directive which we discussed last week and which by and large, we saw as something very appropriate maybe in the longer term but not necessarily very practical in the shorter term. Last week we discussed the Vredeling Directive which had to do with the whole area of consultation by workers in companies. Today we are talking about actual participation which is a step further. I totally support the principle of worker participation in companies as proposed in this directive. I must state that there are a number of very positive arguments against its application in the way the Fifth Directive is set out. We are talking in the Fifth Directive in the context of companies with 1,000 employees and upwards. Of course, there is provision for member states to apply this to a fewer number of persons if that is considered the practical thing to do.

I do not propose to go over the ground which the joint committee have very ably covered. The whole purpose of committees is defeated if one is traversing the same ground the committees have covered. It is a matter, therefore, that we should pick out from the committee's recommendations and suggestions what is relevant and what is in our view acceptable and unacceptable as the case may be.

The joint committee had the benefit of advice and submissions from the various involved interests such as the Federated Union of Employers, the Confederation of Irish Industry, the Consultative Committee of Accountancy Bodies, the various congresses of trade unions as well as the department of Industry and Commerce and the Department of Labour. For that reason, the report presented to us is a very balanced one. Indeed the committee in their report acknowledge the help and co-operation of the various agencies.

The directive, as proposed, has a number of limitations which could take from the attractiveness of outside investment in Ireland. It is something which we must be mindful of at all stages. We must balance what is desirable and what is proper in having worker involvement against what will be acceptable to would-be investors here. There is no doubt that there are many outside bodies who would have reservations about certain aspects of this directive. There are many outside bodies that would have a certain amount of reservations about certain aspects of this directive. It is not always realised by members of unions and their representatives that worker participation is vitally important. I am convinced that with effective worker participation on boards there is a greater likelihood of those boards being dynamic, successful and in fact, being energetic in their pursuits of their business. Frankly, we have a situation very often where workers looking at management from a distance do not appreciate or realise the many difficulties and pitfalls that do exist. There is little opportunity for companies to survive in the absence of that appreciation. People working for a company, whether it is 1,000, 1,200 people, or whatever, are more committed to the success of the company if they are personally involved in it and have a clear understanding of what is going on. The unknown tends to create doubt in people's minds and they are not prepared to accept the reality of the position.

There are a few other points I would like to refer to briefly. Senator Robinson made reference to employee participation in the various options that are put forward by the directive. As has been stated earlier, a two-tier system is, in fact, most unworkable. Unless there is a single-tier arrangement whereby workers and management operate together in a non-confused way, there will not be success at the end of the day. That is one aspect of the directive which must be left aside. The separation of management and workers causes lack of understanding and appreciation of problems that may exist. It is important to put on record that very often management do not totally appreciate the problems of the workers, just as very often the workers do not appreciate the difficulties and problems that confront management, whether it is a limited company or a co-operative society covered by this directive. I would appeal to all concerned at management and worker levels to ensure better mutual understanding of the problems that exist for each member. Due to time problems, I will conclude by saying that this directive as proposed has a great deal of merit, but I do not think it has relevance at this point in time to be applied in this country.

Question put and agreed to.

An Cathaoirleach

When is it proposed to sit again?

Professor Dooge

It is proposed to adjourn the House until 2.30 p.m. on Wednesday next and the principal business to be taken up then will be the continuation of discussion on the Second Stage of the Bill for the re-organisation of CIE.

Agreed and ordered accordingly.