Minister has 'no power to influence' redundancy package for Debenhams staff amid liquidation

The Minister for Social Protection Regina Doherty “understands and admires” the Mandate's determination to get a “just and equitable” redundancy package for its members.
By Eoin English
Irish Examiner Reporter

The minister for social protection has ruled out intervening in the Debenhams liquidation process for legal reasons.

Regina Doherty’s confirmation that she cannot get involved prompted calls for the Oireachtas spending watchdog, the Public Accounts Committee, to examine the retailers’ books now that the State faces the statutory redundancy bill for the company’s Irish workforce.

Fine Gael Senator Jerry Buttimer said he understands Ms Doherty’s position but claimed the workers deserve a fair and just redundancy package.

“We saw it with the Clearys workers and now we have a similar situation again. It’s just not good enough for employers in situations like this to expect others to bail them out,” he said.

Debenhams Retail in the UK announced just before Easter that it was appointing an administrator and was withdrawing support from its loss-making Irish operation, which manages 11 stores and directly employs almost 1,000 people. A further 500 people work in concessions within the stores.

Liquidator KPMG was subsequently appointed to the Irish operation and staff have received redundancy notices.

The affected workers are campaigning for a fair redundancy package, which saw some of them block the removal of assets from the Debenhams’ St Patrick’s St store in Cork earlier this week as part of an official strike action.

Their trade union, Mandate, had written to Ms Doherty asking her to intervene on the workers’ behalf using powers in accordance with Section 15 of the Protection of Employment Act 1977.

In correspondence seen by the Irish Examiner, the minister said she “understands and admires” the union’s determination to get a “just and equitable” redundancy package for its members, and she sought and received urgent legal advice from the Attorney General in relation to those powers as they pertain to a High Court-appointed liquidator.

“The legal advice is unequivocal that I, as Minister, cannot exercise the powers in section 15 because those powers envisaged engagement only with the employer,” she said.

“As is clear from the statutory definition a liquidator is not an employer for the purposes of this act. Therefore there is no possibility of using the section 15 mechanism as suggested by Mandate.

“Although moot, the scope for me to intervene in advance of the appointment of a liquidator is also limited.

“This act which was drafted in an era before the advanced industrial relations framework we know have, provided me, as minister, with no power to influence a particular outcome or to direct a party to take a particular course of action.

“The act instead requires the employer and employees’ representatives in the collective redundancy situation to initiate consultations with a view to reaching agreement.

“There are no consequences under the Act for failure to reach agreement.”

Mr Buttimer said he was disappointed at Debenhams’ decision and said there was little evidence that the parent company had examined the potential for individual stores which were performing well to continue trading.

“I think they pulled the plug prematurely. They gave no clear chance to anyone,” he said.

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