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Dáil
‹ Ceisteanna ó Cheannairí - Leaders' Questions

Debenhams workers settlement

Summary

Deputy Boyd Barrett pressed the long-running Debenhams workers dispute and accused the Government of doing nothing despite sympathy. The Tánaiste praised the workers' campaign but said he could not promise outcomes that were not legally or practically achievable, and argued the Clerys comparison did not hold because the facts and assets were different.

I thank the Tánaiste and call Deputy Richard Boyd Barrett from Solidarity-People Before Profit.

Comment on this

For more than 150 days now, more than 1,000 workers have waged a truly inspiring and heroic struggle for a just settlement following the ruthless and cynical behaviour of Debenhams, their employer, to execute a tactical liquidation in order to leave those workers, who had given decades of service, absolutely high and dry without a penny. Due to their struggle, they have forced the issue of the injustice done to them to the top of the political agenda and although we have had sympathy from the Government, it continues to hide behind various excuses and is doing absolutely nothing to resolve the dispute to ensure that those workers get justice.

This morning, the Taoiseach said on the radio that we cannot invent a scheme in order to give justice to these workers. I strongly challenge that. First, the Debenhams’ workers are in the plight they are in because of the failure, specifically, of the Government that the Tánaiste led to address the issues that arose from Clerys and other types of tactical liquidations over many years. The Tánaiste, specifically, and his Department, have a moral responsibility to get a just settlement for these workers.

The claim that this cannot be done is belied by the fact that although KPMG's offer of €1 million for 1,000 workers who had decades of service was absolutely insulting, that it could make any offer at all proves it can be done. If KPMG can offer €1 million, it can offer the €13 million that is needed to give the two plus two solution. It is unconscionable that Revenue, which is owed €20 million, would not waive its position as creditor when it has benefited from the taxes paid by those workers for 24 years. Those taxes would more than cover the cost of putting the Debenhams workers rather than Revenue at the top of the creditors list. The Government could then go after Debenhams, a company KPMG says has no assets but it turns out has €95 million in the bank, a €2.2 billion turnover and, in the past week or two, revealed that it had €50 million more than it thought it had. It was hiding behind subsidiary companies to load debt on Debenhams in order to avoid paying workers a just settlement. The Tánaiste's excuses will not fly. The workers in Cork ended their occupation this morning and have decided to put the focus now on the responsibility of the Government to give them the just settlement they deserve and which it is responsible for, given that it failed to legislate on the Duffy Cahill report during the Tánaiste's years in government.

Comment on this
Leo Varadkar The Tánaiste Fine Gael

I thank the Deputy for raising this question. I believe the former staff of Debenhams have been treated very badly by their employer in the way these redundancies came about, and they have our sympathies. Like many people, I have been impressed by, and respect, the campaign they have waged for nearly 160 days. They have shown extraordinary resilience and real strength but it is also the reason I do not like to see them being promised outcomes that we all know, even though some of us will only admit it privately, are not possible to achieve. That is not right and it is not honest.

In terms of the Government's role, we will make sure the legal rights of the workers are fully vindicated. That means making sure they get at least two weeks per year of service of statutory redundancy pay. If the liquidator in the company cannot pay that, we will pay for it out of the Social Insurance Fund and pursue it later. We will make sure they get whatever welfare payments and income support they are entitled to. We will make sure they are given opportunities to retrain, access adult education and help to find a new job.

Anything additional to that - anything extra - could only be secured in negotiations between the union and the liquidator. I believe those negotiations should resume, as the Taoiseach said yesterday. I believe Mandate, the trade union, is doing its very best. I heard the head of the union on a radio programme yesterday saying it will do its best to secure the best deal possible. The best deal possible may not be the best deal and may not be a good deal but it will try to secure the best deal possible. I believe Mandate has acted in good faith in that regard, working on behalf of its members. We continue to engage with Mandate and ICTU to assist in any way we can do so. The Government has had a good engagement with congress in recent days, examining possible changes to employment rights law that might give collective agreements more legal weight in situations like this but that will require a degree of work. The Minister of State, Deputy English, corresponded with Ms Patricia King, the head of ICTU, on this only the other day.

On two other points, it is disingenuous to make a connection between the Clerys dispute and this dispute. Clerys was a very different situation. There was a substantial property asset on O'Connell Street and because of that, the owners of that asset were able to make a settlement offer to the workers. The Debenhams case is very different. The only asset appears to be some stock in the stores, probably valued at approximately €10 million, and the value of that is reducing every day this dispute goes on. There are also many other claims on that asset. There are claims from workers who have unpaid pay and annual leave, claims from other businesses, for example, that have unpaid debts, claims from local authorities for unpaid rates and claims from the Irish public for unpaid taxes. The Revenue Commissioners have no authority in law to waive somebody's tax obligations. This is public money. It belongs to all the people of Ireland. There are times when the Revenue Commissioners are not able to collect certain taxes but they cannot simply waive tax when they are able to collect it. It would be very unfair on the Irish people for the Revenue Commissioners to suddenly be given the power, which they do not currently have and could not be given retrospectively anyway, to say that some companies and some people do not have to pay their taxes. If taxes can be recovered, the Revenue Commissioners have an obligation on behalf of the Irish people to make sure those taxes are paid.

Comment on this

To be clear, the points I put to the Tánaiste were not points that I dreamed up. They came directly from the Debenhams workers I was talking to this morning. They are their arguments and their proposals, and I agree with them.

I am glad the Tánaiste mentioned Clerys because what the Debenhams workers pointed out this morning is that precisely the same situation operated in Clerys. The Clerys owners tried to do the same trick that Debenhams is doing. There were two companies in Clerys. There was a trading company that had no assets - none - and then there was a property company that owned the building. The workers still got a deal. It was not a very good deal but it was better than the deal they would have got had they not fought. That is exactly what is going on here. The claim that Debenhams Ireland does not have assets is not true. There are assets worth millions in the stores. Moreover, artificial debt was loaded on the company and there is a retail business still operating, all run by a parent company that has massive assets. This is a manipulation of the situation and, therefore, it is right and correct, particularly because of the Government's failure over years to address the issues arising out of Clerys and other disputes, to say that they will secure the moneys necessary to pay the two plus two.

I ask the Tánaiste not to forget the point I made about all the taxes the Debenhams workers paid to Revenue, which give them a moral claim on the Revenue's position on the creditors list.

Comment on this
Leo Varadkar The Tánaiste Fine Gael

I have engaged with the workers too. I have met them. I have engaged with Mandate, the trade union, and ICTU. I have spoken directly to Debenhams UK and I have sought advice from the Attorney General. The facts that I have are different from the facts the Deputy has. The basic fundamental facts differ as follows. Clerys was a very different situation. There was a very substantial and valuable asset, a building on O'Connell Street, and its owners were able to make an ex gratia settlement to the workers. In this case, there are not assets of that value. There is stock that may be worth €10 million, which is diminishing in value every day, and there are many other claims on that asset. Those who have claims will not receive all of the money that they perhaps would like to receive.

I have spoken to Debenhams UK and I have it in writing from the company that it is a UK based company and a separate legal entity in a different country. It says it has put €30 million into Debenhams Ireland over the past couple of years. This company was in trouble for a long time. It was in examinership three or four years ago. Debenhams UK says it has put €30 million into it. It will not get that money back. It has laid off staff in the UK and its UK staff have only got statutory redundancy. While the Deputy says the company has €90 million in the bank, that cannot possibly be the full story because Debenhams UK is in examinership or administration. A company that has massive assets in the bank does not end up in examinership or administration. If it has massive amounts of money in the bank, it must also have massive liabilities and debts.

Comment on this

That concludes Leaders' Questions for today. I understand the Government Chief Whip has a business proposal to put to the House.

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