Labour Court Database __________________________________________________________________________________ File Number: CD86746 Case Number: LCR10780 Section / Act: S67 Parties: UDARAS NA GAELTACHTA - and - ASTMS |
Dispute concerning a claim for terminal payments for redundancy and service buy-out.
Recommendation:
5. The Court considers that the substantive terms of the
agreement of 7th June, 1985 have been acted upon and honoured by
both sides. The extra clause by which the Union reserved a right
to process a claim against Udaras has now been implemented in that
the Court heard the case and Udaras have co-operated in the
investigation.
Having regard to all the circumstances of the case and the content
of the extra clause, the Court does not recommend concession of
the claim.
Division: Mr O'Connell Mr McHenry Ms Ni Mhurchu
Text of Document__________________________________________________________________
CD86746 THE LABOUR COURT LCR10780
Section 20(1) INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. LCR10780
Parties: UDARAS NA GAELTACHTA
and
ASSOCIATION OF SCIENTIFIC TECHNICAL AND MANAGERIAL STAFFS
Subject:
1. Dispute concerning a claim for terminal payments for
redundancy and service buy-out.
Background:
2. Aireamh Teo which was a wholly owned subsidiary of Udaras na
Gaeltachta up to June, 1985, took over the premises and some of
the staff of Neodata Ltd, an American based company in the data
processing business in June, 1981. It was agreed that the
transferred staff would enjoy the same pay and conditions and
carry forward their service with Neodata to Aireamh Teo. It was
also further agreed that a lump sum of #24,500 be placed in a fund
for any future redundancies which might affect the transferred
employees. In June, 1985 the Management of Aireamh Teo bought the
Udaras shares in the Company and as part of the sale arrangement
Udaras funded the Company to buy out the redundancy entitlements
accruing under Udaras ownership based on statutory rates only. By
an agreement dated 9th June, 1985 six employees were dismissed by
reason of redundancy and were paid ex gratia payments (12 weeks'
pay) from the Neodata fund. Regarding the remainder of the
employees who were retained by the new Company it was agreed that
they be paid statutory entitlement for their service with Aireamh
Teo and that the remainder of the fund be divided among them on a
pro-rata basis for their service with Neodata Ltd. The Union
sought severance payments from Udaras na Gaeltachta similar to
that paid to the six employees who were made redundant. Udaras
rejected this claim. The Union referred the matter to the Labour
Court for investigation and recommendation under Section 20(1) of
the Industrial Relations Act, 1969 and agreed to be bound by the
recommendation of the Court. A Labour Court hearing was held in
Tralee on 1st October, 1986, a date suitable to both parties.
Union's arguments:
3. (i) It was agreed that the employees being made redundant
should receive enhanced entitlement from the Neodata
fund and that a claim on behalf of the remainder of the
employees should be pursued for the same terms in
respect of a buy-out of service with both Neodata and
Aireamh Teo from Udaras na Gaeltachta.
(ii) The twenty employees which this case refers to should
receive settlement at least as favourable to the terms
of those who left in 1985.
Udaras arguments:
4. (a) Aireamh Teo was in the serious financial position of
being insolvent at the time of the Management buy out.
(b) The Udaras brought the company up to a solvency position
in order to provide it and its employees with an
opportunity to remain in business. Without such
funding, the Company would have closed, with no payments
in excess of the statutory redundancy entitlements.
(c) The Udaras being a semi State company is confined by
Government directives regarding redundancy settlements,
and could not at any stage have offered additional
funding to finance enhanced redundancy payments.
(d) The Udaras in order to try and assist the new company
has provided it with training and capital grants.
(e) Had it not been in a position to offer such items of
funding the company would not be in business today.
RECOMMENDATION:
5. The Court considers that the substantive terms of the
agreement of 7th June, 1985 have been acted upon and honoured by
both sides. The extra clause by which the Union reserved a right
to process a claim against Udaras has now been implemented in that
the Court heard the case and Udaras have co-operated in the
investigation.
Having regard to all the circumstances of the case and the content
of the extra clause, the Court does not recommend concession of
the claim.
~
Signed on behalf of the Labour Court
John M. Horgan
_______________________
Chairman.
21st November, 1986.
M.D./J.C.