Labour Court Database __________________________________________________________________________________ File Number: CD88121 Case Number: LCR11817 Section / Act: S67 Parties: UPRIGHT LIMITED - and - NATIONAL ENGINEERING AND ELECTRICAL TRADE UNION |
Recognition of service of two employees.
Recommendation:
8. Having considered the submissions made by the parties the
Court has come to the following conclusions.
In the first instance, insofar as redundancy ends all accrued
benefits from previous employment, the Company is theoretically
correct in the terms offered to the two employees concerned on the
occasion of their re-employment. However in view of the very
short break in service, the requirement to serve another period of
probation to assess suitability seem inequitable in the
circumstances of this case.
The Court therefore recommends, insofar as bonus payment is
concerned, that bonus be paid in respect of Worker A for the
quarter ending 31st September, 1986 and in respect of Worker B for
the quarter ending 31st December, 1986.
Insofar as redundancy broke service the Court further recommends
that they be placed on the starting point of salary scale to
commence with effect from the start of their second employment.
The Court further recommends that the comprehensive agreement be
clarified to take account of similar circumstances arising in the
future.
Division: Mr O'Connell Mr Heffernan Mr Walsh
Text of Document__________________________________________________________________
CD88121 RECOMMENDATION NO. LCR11817
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: UPRIGHT LIMITED
(REPRESENTED BY THE FEDERATED UNION OF EMPLOYERS)
and
NATIONAL ENGINEERING AND ELECTRICAL TRADE UNION
SUBJECT:
1. Recognition of service of two employees.
BACKGROUND:
2. The Company is engaged in the manufacture of ladders. It
employs approximately 150 workers and temporary employment is
common due to fluctuations in demand. The current salary scale
for general operatives is £170.48, £177.72, £185.36, £192.44,
£200.12, £212.84. A quarterly bonus, paid in arrears, also
exists. The current claim concerns two employees whom the Company
states were made redundant and re-employed while the Union states
that they were on short term lay-off.
3. Worker A commenced work as a temporary employee on 2nd
January, 1986. He was put on probation of three months and became
a permanent employee on 1st April, 1986. His employment ceased on
13th June, 1986 (the Company states that he was made redundant
while the Union states that he was laid-off). He was re-employed
on 21st July, 1986 and has been in the Company's employment since
then. On return to work he was again put on probation and made
permanent. His salary scale and bonus payments are now
calculated taking 21st July, 1986 as the commencement date of
employment. The Union contends that the date of 2nd January, 1986
should be used.
4. Worker B commenced work with the Company on 2nd September,
1985 and was put on three months probation. He was involved in an
industrial accident on 18th November, 1985 and his probation was
extended until 15th January, 1986 due to his resulting absence
from work. His employment ceased on 7th May, 1986, in the same
circumstances as the other worker. He took up alternative
employment with another employer. This job was arranged for him
by the Production Manager in Upright Limited. On 8th September,
1986 he was re-employed by Upright Limited on a temporary basis.
He was again put on probation and has remained in employment as a
permanent employee since then. His salary scale and bonus
payments are calculated on the basis of the date of commencement
of his employment being 8th September, 1986. The Union contends
that the date of 2nd September, 1985 should be used.
5. The matter was referred to the conciliation service of the
Labour Court on 8th December, 1987 and a conciliation conference
was held on 15th February, 1988. No agreement being reached, the
matter was referred to a full hearing of the Labour Court. The
hearing took place on 6th April, 1988.
UNION'S ARGUMENTS:
6. 1. Worker A commenced employment on 2nd January, 1986. He
should have progressed to the second point of the six point
salary scale in January, 1987. He did not do so until
October, 1987, losing nine months at the higher rate. Under
the bonus scheme, an employee commences receipt of bonus
payments on the first day of the calendar quarter following
the successful completion of the probationary period. In this
worker's case this was 1st April, 1986. In fact his bonus
payments did not commence until April, 1987. He is therefore
due compensation of approximately 25% of his gross pay from
1st April, 1986 to 31st March, 1987.
2. Worker B should have progressed to the second point of the
salary scale on 1st September, 1986 but did not do so until
1st September, 1987. He is therefore entitled to twelve
months arrears at the appropriate rate. He should have been
in receipt of bonus from 1st September, 1986 rather than 1st
January, 1987. He is therefore entitled to compensation of
approximately 8% of his salary from October to December, 1987.
3. The Union contends that in the case of the two workers the
periods when they were not working for the Company were
periods of temporary lay-off. They were not made redundant.
It should not have been necessary for them to complete second
probationary periods.
4. Clauses 5.7 and 5.8 of the Company Union Agreement state
as follows:
"5.7 The probationary period of a new employee, who
started as a temporary employee, begins on the date
of his first temporary employment.
5.8 The official starting date of an employee, who was a
temporary employee before being made permanent, is
the date of his first temporary employment."
COMPANY'S ARGUMENTS:
7. 1. The two employees were made redundant and were
subsequently re-employed, thus breaking their continuity of
employment, in one case by five weeks and in the other by
three months. The fact that the Production Manager arranged
alternative employment with a different employer for one of
the workers in 1986 indicates the fact that this was a
redundancy situation.
7. 2. The Company has applied the probationary period in both
cases on re-employing the workers.
3. There is no basis or precedent for recognising the prior
service in redundancy situations where workers are
subsequently re-employed. To do so would create unacceptable
precedents.
4. The Company considers that it has at all times acted in
accordance with the terms of its Agreement with the Union.
The redundancies and subsequent re-employment of the workers
arose in response to demand for the Company's product.
RECOMMENDATION:
8. Having considered the submissions made by the parties the
Court has come to the following conclusions.
In the first instance, insofar as redundancy ends all accrued
benefits from previous employment, the Company is theoretically
correct in the terms offered to the two employees concerned on the
occasion of their re-employment. However in view of the very
short break in service, the requirement to serve another period of
probation to assess suitability seem inequitable in the
circumstances of this case.
The Court therefore recommends, insofar as bonus payment is
concerned, that bonus be paid in respect of Worker A for the
quarter ending 31st September, 1986 and in respect of Worker B for
the quarter ending 31st December, 1986.
Insofar as redundancy broke service the Court further recommends
that they be placed on the starting point of salary scale to
commence with effect from the start of their second employment.
The Court further recommends that the comprehensive agreement be
clarified to take account of similar circumstances arising in the
future.
~
Signed on behalf of the Labour Court
John O'Connell
_________________________
26th April, 1988. Deputy Chairman
A.K./J.C.