Labour Court Database __________________________________________________________________________________ File Number: CD86814 Case Number: LCR10848 Section / Act: S67 Parties: C.P.M. - and - ITGWU |
Dispute concerning redundancy and rationalisation.
Recommendation:
5. In dealing with the issues placed before it in this case the
Court has paid particular attention to the circumstances which
have brought about the changes from which the claims derive. It
seems clear that fundamentally the Company's investment, together
with the concentration of production arises from an effort, not
necessarily to cope with an expanding market but to maintain and
consolidate its share of a reduced market. In such circumstances
agreements based on shared savings, in the view of the Court, must
be modified to the extent that the changes also contribute to job
security for the remainder of the workforce.
For this reason the Court considers that the Company's offer to
adjust production allowances is fair and reasonable and should be
accepted by the workers concerned.
The Court further considers that the Company's offer in respect of
4 - shift working is fair and reasonable and should be accepted.
As regards the terms offered to workers to be made redundant by
the changes it seems to the Court only fair that any extension of
the proposals already made should be directed towards this group
of workers. The Court therefore recommends that the Company amend
its offer to provide for statutory entitlement plus #600 per year
of service subject to the minimum of #3,000.
Division: Mr O'Connell Mr McHenry Mr Devine
Text of Document__________________________________________________________________
CD86814 THE LABOUR COURT LCR10848
CC861162 INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. LCR10848
Parties: C.P.M. EUROPE LTD
and
IRISH TRANSPORT AND GENERAL WORKERS' UNION
Subject:
1. Dispute concerning redundancy and rationalisation.
Background:
2. The Company which started in 1975 employs 78 people of whom 60
are hourly paid workers, members of the Union. It manufactures
hardened steel die rings for pelleting animal feed stuff and
together with a C.P.M. unit in Amsterdam services mainly the
European market. Because of changing trends in the market place
and new entrants into the business over the years, the Company, in
late 1985, considered it necessary to rationalise its die
production in Europe by two means: (a) To invest further in the
latest drilling equipment to produce a product which was gaining
increasing acceptance in the European market. (b) Concentrate
die production in one plant to achieve economies of production.
The Wexford plant was chosen to consolidate the die production.
Discussions on the introduction of the new technology, numbers and
terms of redundancy as well as revised work practices commenced
between the Company and Union in October, 1985. Following
negotiations at local level agreement was reached on the
introduction of new plant, the number of people to be made
redundant (13), 8 people going on a four shift operation and the
payment of productivity payments. However as no agreement could
be reached on the monetary elements to apply to each the
matter was referred to the conciliation service of the Labour
Court on 10th July, 1986. A conciliation conference was held on
10th October, 1986. The position of the parties after the
conference was as follows: Company offering redundancy - #500 a
year plus statutory entitlement, minimum payment of #3,000,- Union
seeking 6 weeks' pay per year of service plus statutory
entitlement. Shift operation - Company offering 35% shift premium
in respect of 4 shift operation. Union seeking 50% premium.
Productivity payment - Company offering #10 a week added to
existing productivity payment to those directly involved in
increased productivity (group 1), 28 employees would be paid as
soon as new work method begins and #4 a week to those not directly
involved, (group 11), 19 employees would be paid when all
redundancies have been concluded. Union seeking around #30 to
group 1 and #15 to #20 to group 11. As no progress was made, it
was agreed to refer the matter to the Labour Court for
investigation and recommendation. A Labour Court hearing took
place in Wexford on 25th November, 1986.
Union's arguments:
3. (a) The people being declared redundant are making way for
new equipment which the Company considers more
efficient than manpower.
(b) The chances of securing other employment are very slim,
hence the need for decent compensation to help them
adjust to more stringent circumstances.
(c) As 11 years is the longest service of anyone in the
Company the level of compensation offered is
unacceptable. Other companies in the Wexford area, who
have also declared people redundant because of the
introduction of new technology, have paid better
compensation.
(d) The claim for increased productivity allowance is based
on the savings which will accrue to the Company after
the proposed redundancies have taken effect.
(e) The proposed changes in the shift operation represents
a major change in conditions of employment for the
workers concerned. The Company's offer works out at an
additional 2% or #2.62 per week (gross) over the
present 3 shift operation. This is considered to be
inadequate.
Company's arguments:
4. (i) The changes proposed are necessary to ensure that the
Company can operate from a Wexford base.
(ii) The Company has invested heavily in new machinery to
make it more competitive in the market place. The
settlement terms for the redundancies and the
compensatory package for those remaining in the
workforce are fair and reasonable, and are in line with
those prevailing in industry generally.
RECOMMENDATION:
5. In dealing with the issues placed before it in this case the
Court has paid particular attention to the circumstances which
have brought about the changes from which the claims derive. It
seems clear that fundamentally the Company's investment, together
with the concentration of production arises from an effort, not
necessarily to cope with an expanding market but to maintain and
consolidate its share of a reduced market. In such circumstances
agreements based on shared savings, in the view of the Court, must
be modified to the extent that the changes also contribute to job
security for the remainder of the workforce.
For this reason the Court considers that the Company's offer to
adjust production allowances is fair and reasonable and should be
accepted by the workers concerned.
The Court further considers that the Company's offer in respect of
4 - shift working is fair and reasonable and should be accepted.
As regards the terms offered to workers to be made redundant by
the changes it seems to the Court only fair that any extension of
the proposals already made should be directed towards this group
of workers. The Court therefore recommends that the Company amend
its offer to provide for statutory entitlement plus #600 per year
of service subject to the minimum of #3,000.
~
Signed on behalf of the Labour Court
John O'Connell
_____________________________
Deputy Chairman.
4th December, 1986.
M.D./J.C.