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A year on from Clerys closure and workers still unprotected - Cullinane

12 June, 2016 - by David Cullinane TD

Sinn Féin spokesperson on worker’s rights, David Cullinane TD has said that there is still much to be done to protect workers to ensure a similar situation to that of the Clerys closure would not happen again. 

The overnight closure of the Dublin department store saw 460 people lose their jobs without redundancies, yet the owners walked away with profits of up to €15 million euro. 

Deputy Cullinane will be moving a Bill in the Dáil on Wednesday which seeks to include a provision to deal with such so-called ‘tactical insolvencies’. 

He and other members of Sinn Féin will join former Clerys workers and trade unionists at an event outside the former Department Store today at 1pm. 

Deputy Cullinane said: 

“This is the first Anniversary of the closure of Clerys and the shocking way in which the company was wound up. The Gordon Brothers Group essentially engaged in a tactical insolvency. This means the company was split in two parts to allow the directors avoid responsibility to their staff and yet walk away with a reported €15 million profit. 

“Next Wednesday Sinn Fein will move a Bill in the Dáil that seeks to include a provision on the Companies Act 2014 to deal with tactical insolvencies that leave employees high and dry.

“Sinn Féin’s bill has a particular eye to businesses who shirk their responsibilities to their employees by establishing a number of companies to break the link between assets and employees. This is exactly what has happened in the case of Clerys.

“Our legislation provides for a ‘piercing of the corporate veil’ to hold unscrupulous business owners to account and protect vulnerable workers. When used by a business the ‘corporate veil’ in effect separates the legal ‘personality’ of a company from its Director’s, thus protecting them from liability of the business’s obligations to its employees in cases of tactical insolvency. 

“Gordon Brothers walked away from the Clerys sale with multi millions profits, yet we are told the very same business did not have enough cash to pay holiday money or redundancies to workers or the €2 million they owe to the concession holders. 

"Sinn Féin is fully committed to taking the steps to improve the legislation which prevents rogue employers from engaging in tactical insolvencies for the purposes of avoiding legal responsibilities to creditors and workers. What happened with Clerys workers should never be allowed happen again." 

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