Labour Court Database __________________________________________________________________________________ File Number: CD88268 Case Number: LCR11818 Section / Act: S67 Parties: M. GLYNN AND SONS LIMITED - and - IRISH TRANSPORT AND GENERAL WORKERS' UNION |
Claim, on behalf of seven workers, for redundancy compensation.
Recommendation:
6. The Court, having considered the submissions made by the
parties, recommends that the Union accepts the Company's original
offer improved by an ex-gratia payment of £1,000 per worker for
those with more than 10 years' service and £500 for the worker
with less than 10 years's service.
Division: Mr Fitzgerald Mr Heffernan Mr Devine
Text of Document__________________________________________________________________
CD88268 RECOMMENDATION NO. LCR11818
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: M. GLYNN AND SONS LIMITED
(Represented by the Federated Union of Employers)
and
IRISH TRANSPORT AND GENERAL WORKERS' UNION
SUBJECT:
1. Claim, on behalf of seven workers, for redundancy
compensation.
BACKGROUND:
2. The Company has been in the milling business in Kilrush since
1811. In the 1970's, due to its production of high quality
poultry feed, it become heavily dependent on two main customers
and dependence continued into the 80's despite attempts to broaden
the customer base. Since 1981 production has fallen annually, In
1984 when one of its main customers appointed a liquidator the
Company sustained a large loss through the resultant bad debt.
The continuing reduction in throughput resulted in an increasing
overhead per ton sold.
3. In mid-1987 it became clear to the directors of the Company
that they could not continue production much longer nor could they
continue to fund large losses. At this point negotiations began
with three other millers in an effort to have the Glynn milled
feeds produced and to establish a small retail operation on the
site of the mill in Kilrush. Agreement was reached with a
Limerick miller in February, 1988 and production was discontinued
at the Kilrush mill. As a result redundancy notice was issued to
the workers here concerned. In a previous redundancy situation in
1982 the severance terms were statutory redundancy plus the 60%
rebate plus a service related ex-gratia sum as follows:-
£1000 - 11 years and over
£ 750 - greater than 6 years but less than 11
£ 500 - less than 6 years.
The Union, on the workers' behalf sought compensation of three
weeks' pay per year of service in addition to their statutory
entitlements plus the rebate from the Department of Labour. The
Company rejected this claim but was willing to offer statutory
redundancy plus the value of the rebate to each worker. This was
not acceptable to the Union and as no agreement could be reached
the matter was referred to the conciliation service of the Labour
Court. No basis for a settlement could be reached at a
conciliation conference held on 7th April, 1988 and the matter was
referred to the Labour Court for an early hearing. The Court
investigated the dispute on 15th April, 1988.
UNION'S ARGUMENTS:
4. 1. The transfer of production to another miller appears to
affect only the jobs in the production area. Industrial
relations in the Company have always been good and the workers
have always co-operated with the Company in an effort to help
it through its difficulties.
2. Severance payments well in excess of statutory
entitlements have already been paid out by this Company. The
Union's claim is in line with redundancy payments generally in
the Clare area.
3. The total cost of the Union's claim is less than £60,000
which is a very small sum compared to the profits made by the
Company in years gone by.
4. The Company's new trading arrangements will eliminate
any duplication of sales and transport costs and should prove
a profitable venture.
5. The Union believes that the Company has, or can get, the
resources to pay the compensation claimed.
6. The Union understands that the Company premises may be a
very valuable property in the context of a new marina in
Kilrush.
COMPANY'S ARGUMENTS:
5. 1. The Company's sales in the period 1981-1987 fell from
22,218 tonnes to 9,004 tonnes, a decline of 60% in only six
years (details supplied to the Court). In the six months from
1st September, 1987 sales fell even further to 7,000 tonnes
(annualised).
2. During the eighteen months prior to cessation of
production at the mill the Company recorded totally
unacceptable losses.
3. The Company has made it clear to the Union that it is in
no position to meet the level of settlement claimed. It does
not accepte that this level represents a norm or understanding
in the region. Neither is the Company in a position to make
an offer of a severance package of the terms which were agreed
with the Union for the previous redundancies in the Company.
4. The Company has not had any offer for its premises as a
result of the proposed marina and it is unlikely to receive
any because of their location. The Company considers its
buildings to be seriously overvalued on the balance sheet.
RECOMMENDATION:
6. The Court, having considered the submissions made by the
parties, recommends that the Union accepts the Company's original
offer improved by an ex-gratia payment of £1,000 per worker for
those with more than 10 years' service and £500 for the worker
with less than 10 years's service.
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Signed on behalf of the Labour Court
Nicholas Fitzgerald
26th April, 1988 --------------------
R.B./U.S. Deputy Chairman