EU Wide Social Dumping Scandal

RTE, the Irish broadcaster, has a fascinating radio documentary about questionable firms and strange justice. Bogdan Chain is a Polish worker recruited by an Irish company Atlanco (registered in Cyprus to reduce its social and tax costs) to work in skilled manual labor jobs in places like Finland and Norway. In March this year a case known as Bogdan Chain vs Atlanco reached Europe’s highest court, on the issue of where employers and workers should pay social insurance. The only problem? Chain knew absolutely nothing about the case. It seems the Irish recruitment agency created a false lawsuit and hired a Belgian law firm to represent Chain without his consent. Tony Connelly, Europe editor for RTE, who tipped me off about this story, will continue to follow the many unanswered questions of the case. LISTEN: http://bit.ly/1m92CdS

Here is the story in full. You can watch a Scottish Parliament video on Zero Hour Contracts and unusual working practises below.

An Irish company with an address in Rathmines has found itself at the centre of fresh allegations of Europe wide blacklisting in the construction sector and has been accused of “modern day slavery” by senior UK union officials.

Blacklisting is the practice of blocking those perceived as union activists or agitators from being hired. The long suspected practice of blacklisting emerged solidly into the spotlight in 2009. When the UK Information Commissioners Office (ICO)  seized a Consulting Association database of over 3,000 construction workers which was used by 44 companies to vet new recruits.

Yesterday, trade unionists raised fresh concerns at the Scottish Affairs Select Committee arising from claims about the existence of another blacklist made in a Danish documentary last May.

The Dublin based company Atlanco Rimec, featured in the documentary investigation by Denmark’s national broadcaster DR. The station accused the company, which has thousands of construction workers employed on short-term contracts throughout Europe, of keeping a secret register of workers, charting their behaviour and their union dealings.

The hearings take place against the backdrop of a decision by the the London High Court to combine four legal cases brought on behalf of employees who appeared on previous black lists subscribed to by many of the UK’s largest contractors.

Justin Bowden, of the GMB union, named and shamed Atlanco Rimec as “contemporary blacklisters”. The GMB describes itself as “Britain’s General Union” and consists of over 700,000 members. It was involved in massive strike actions in local authorities and schools earlier this month over conditions and pay.

The GMB brought a three page report to the table.  rabble has received this report. Speaking towards the end of the MP probe, Justin Bowden said:

“We can look you in the eye with all confidence and say with all confidence that they have been undertaking blacklisting of workers in the extremely recent past. In terms of what or who they are, they are an agency, a temporary employment broker would be another way of describing them. They are a very large and sophisticated company which is made up of a web of some sixty plus companies, actually it’s probably 70 – 80 including those that they close down, they open them up and close them down as they accumulate debt or the issues become too great. Many of the share holding companies you’d be surprised to hear are based in Jersey. The financial officer of several of the companies…someone called Catherine Foy has admitted to DR, the Danish national broadcaster that it does keep a register of its workers.”

Atlanco Rimec was founded in 1994 by Micheal O’Shea. He was listed on the Irish Independent’s rich list for 2014, where his worth was valued at €65 million.  He’s described by the Indo as “low-profile private equity baron,” who is said to have moved to Geneva.

The committee yesterday was told how they had 500,000 employees across their web of companies, Bowden summed up his view of their business model to the hearing before reading in several examples of comments on the register.

“It’s model basically is bidding on contracts at northern European prices in simple terms and employing labour at Southern European and Eastern European rates from those countries. They then cream the bit out of the middle and frequently cream tax and national insurance to boot on the back of that too.”

In the documentary, the station reported it had photographed the secret register operated by the company. It went as far as to claim its existence was confirmed by a former manager who told them on the condition of anonymity that:

“Atlanco Rimec does not tolerate workers who have dealings with unions. That is a complete no-no in the company because unions can cause a lot of problems.”

In Denmark the agency provided flexible labour for construction projects such as the Copenhagen Metro. In one extract from the Danish TV doc forwarded to rabble, a former higher up employee in Atlanco Rimec said:

“I’m afraid, everybody’s afraid of Michael O’Shea. Michael O’Shea has vast sums of money, he can use that money he has to cause trouble financially or physically. They have a genuine fear of Mike, they know him, they know what he’s capable of.”

He also stated that:

“If a worker wants to get a union involved, that worker will never work for Atlanco again. We can’t have workers in contact with the unions, it’s basically forbidden within the company, simply because if the union get involved and the union are provided with information, they will simply cause problems.”

The register is said to grade workers on ability, attendance, time keeping and attitude.  One example of comments about a UK based worker read:

“This guy is the absolute worst category of trouble maker you could possibly find. He is a union representative and very militant. He was the main cause of the strike in Langage on the 7th August. I would never re-employ person again.”

The company is no stranger to controversy. Last year, a journalist called Rob Fox working for the regional De Limburger got a tip that Portuguese workers were being deducted €968.75 a month for so called “logistic costs” while working on a tunnel project.

The European Federation of Building and Woodworkers detailed this case, of what it called “social dumping” during the construction of the A2 highway in Maastricht. The federation’s website described how:

“During their stay in the Netherlands, the posted workers have been living in rented houses which were due to be demolished. Each worker had to pay a monthly rent of 968.75 Euro to Atlanco Rimec, despite the dilapidated state of the houses. The sum was directly deducted from 35 workers’ monthly salaries, under the guise of “logistical costs”. Three to four workers lived in a house. In this way Atlanco Rimec cashed in a minimum rent of 3,000 Euro per month, for each house which was due to be demolished. Thus, in total the company deducted each year at least 400,000 Euro directly from the workers’ salaries. Meanwhile, it was discovered that the owner of the houses, a Dutch housing corporation, rented out 14 houses for 350 Euro per month to Atlanco Rimec, which is a normal sub-market rent for a house which is not maintained and which is ready to be demolished.”

The company was also at the centre of race discrimination proceedings up North in 2006. Portuguese national, Paulo Diniz, was placed by Atlanco Rimec in O’Kane Poultry as a packer. He alleged he was given the most unpleasant jobs to do and that there was racial segregation on the production line. The claimant was paid £4,000.

Micheal O’Shea is also the founder of Kerten a “boutique Irish private equity firm” with investments in Turkish chocolate manufacturers. Kerten is reported to be invested across Eastern Europe with Istanbul based self-catering apartment rental firms, as well as car parts and labour outsourcing in the automotive trade in its portfolio. The Kerten website boasts that he owns “a significant real estate portfolio.” Atlanco Rimec have been involved in a huge array of projects in the UK such as Langage Power Station in Plymouth and through subsidiaries supplies staff to the NHS.

Bowden finished his comments to the committee by saying:

“These are the real deal in our view, an extremely sophisticated very, very hard nosed company. Clearly exploiting workers and I chose my words very, very carefully, arguably engaging in modern day slavery.”

When prompted by rabble,  Bowden told us that:

“GMB is looking to Irish labour movement to help bring this company to book. They are registered in Ireland and Irish regulatory authorities have a duty to act on behalf of of workers in rest of Europe. “

The company and its alleged practices have so far escaped the gaze of the Irish media.

The Scottish Parliament discusses unusual working practices: