asked the Minister for Labour if he has examined the manner in which Norco Ltd., Industrial Estate, Waterford went into liquidation; if the procedures involved were in compliance with his Department's regulations; and, if not, the action he proposes to take.
Ceisteanna — Questions. Oral Answers. - Waterford Industrial Estate.
1.
I understand that at an ordinary general meeting of the members a resolution was passed to wind up the company and that a liquidator was appointed on 12 September 1988. This procedure is not subject to approval under the provisions of any legislation administered by my Department. A company who cease business because of winding-up proceedings are excluded from the notification provisions of the Protection of Employment Act, 1977.
I understand further that there is a dispute in progress between the company and their employees on the question of payment of extra statutory redundancy lump sums. The Labour Court recommend that the liquidator use what influence he has to ensure the workers be paid a sum equivalent to twice the statutory amount. I have no powers to ensure the implementation of recommendations of the court.
My Department are concerned with payments of statutory entitlements to the employees of the company under the Redundancy Payments Acts and the Protection of Employees (Employers' Insolvency) Act. To date, the Department have received copies of the statutory redundancy notices issued to 61 employees but no applications for payments of statutory redundancy lump sums from the redundancy and employers' insolvency fund have been received. If the liquidator fails to pay the employees their statutory redundancy lump sum entitlements, the amount due can be paid directly by my Department from the fund. However, I understand that the employees in pursuit of their claim for payment of extra statutory lump sums have not accepted statutory redundancy certificates from the liquidator. If the employees wish to pursue the question of payment of their statutory entitlements from the fund, they should sign the redundancy certificates, form RP2, and submit them to my Department together with completed application forms RP14.
Concerning payments of other outstanding entitlements due to employees, the position is that on Friday last, 21 October, the liquidator submitted applications on behalf of the employees under the Protection of Employees (Employers' Insolvency) Act, 1984, for payment of arrears of wages amounting to £11,145, arrears of holiday pay amounting to £38,037 and sick pay of £369.
The insolvency payments section of my Department is processing these applications and I expect that funds will be issued to the liquidator within about two weeks to enable him to pay the employees their outstanding entitlements.
Finally, as regards entitlements under the Minimum Notice and Terms of Employment Act, 1973, I understand that the employees have recently submitted appeals to the Employment Appeals Tribunal with a view to determining the amounts, if any, due to them under the Act. If the employees receive awards from the tribunal they will be sent with the awards, copies of forms of application for payment under the 1984 Act. The employees should complete and forward these forms to the liquidator to enable him apply to my Department for the money to pay their entitlements.
I thank the Minister for his detailed answer in regard to his obligations but would he not agree that this was probably the most appalling abuse of industrial relations we have seen in this country in a long time where a company closed their doors on a Friday afternoon and literally locked the staff out, thereby putting the clock back by some 60 years in terms of industrial relations? Would the Minister not be concerned that this type of management and behaviour on the part of a company is not acceptable? This foreign company availed of grants from the IDA and from the ESF — and had an order book for products totalling £1,500,000 so there was no real need for them to go into liquidation, an act which abandoned a large and highly skilled staff. Such a decision arbitrarily taken in America, with no consultation whatsoever, must be very worrying so far as the attitude of American companies operating in this country is concerned.
I think I am being asked a separate question now which is to give details of matters under review. Recently in Waterford I met some of the former staff of the company. Certainly nobody could feel happy with the position where almost at once the jobs of the staff of a company who were doing quite well were left high and dry. My function is to try, wherever I can, to assist the workers involved.
Has the Minister had any contact with his colleague in the Department of Industry and Commerce and if so, has he impressed on him the need to seek a similar type of operation for these workers who possess a very specialised skill? It would be a great loss economically and nationally to have those skills dissipated after so much investment had been put into them. It is urgent from the points of view of the Government and the IDA that a similar company be found to maintain these skills and the high level of technology which had been developed over a period.
I am sure the Minister for Industry and Commerce would take those views into account and probably has already done so.
Having regard to all the circumstances that have surrounded this outrageous affair are the Department, having examined the files, prepared to initiate proceedings against the company for breaches of the labour legislation?
As I have outlined in a fairly long Bill I do not believe they have. The position is that at an ordinary general meeting of the members the resolution was passed to wind up the company. A liquidator was then appointed. The Deputy has outlined that the circumstances were such that in the normal course of events it did not seem that it was necessary to appoint a liquidator. So the company were not in breach of any of the labour legislation.
Deputy Birminghan rose.
I want to deal with other questions also. I cannot dwell unduly long on any one question. A brief question from Deputy Birmingham, please.
Would the Minister agree that the circumstances that have arisen here would suggest that it might be appropriate to look again at the legislation and to see whether the existing legislation does not contain some loop-holes that could be availed of by unscrupulous employers and that in those circumstances some amendments might be required?
I believe that this question came up when the Protection of Employment Act was going through. The position was that a company who cease business because of winding up proceedings are excluded from the notification provisions of that Act. In a case such as this I wonder whether it would have made much difference. I would have regard to the fact that the staff were highly trained and were, I understand, well paid and that there was a good order book but unfortunately when a company decide to wind up their affairs and appoint a liquidator it is then a matter for company law.
Deputy Cullen rose.
I have given Deputy Cullen a lot of latitude on this question. A very brief supplementary, please.
Is the Minister aware that there was only about £250,000 of a debt in that company while orders totalled £1,500,000? Would he not agree that this was an abuse of legislation and of agreements already drawn up? Has he set up an examination in his Department to look in detail at this matter and, if so, what were the findings?
I think I have answered the question. The company were not in breach of labour legislation. Any other questions regarding company law should be put down to the Minister for Industry and Commerce.