Labour Court Database __________________________________________________________________________________ File Number: CD89673 Case Number: LCR12643 Section / Act: S20(1) Parties: REG ARMSTRONG MOTOR CYCLE (SALES) LIMITED - and - SALES MARKETING AND ADMINISTRATIVE UNION OF IRELAND |
Claim on behalf of two former sales representatives for enhanced redundancy lump sum payments.
Recommendation:
8. Having regard to the particular circumstances of this case and
usual practice in redundancy situations, the Court recommends
concession of the Union's claim.
Division: CHAIRMAN Mr Keogh Mr Devine
Text of Document__________________________________________________________________
CD89673 RECOMMENDATION NO. LCR12643
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 20(1)
PARTIES: REG ARMSTRONG MOTOR CYCLE (SALES) LIMITED
F.W. ARMSTRONG LIMITED
and
SALES MARKETING AND ADMINISTRATIVE UNION OF IRELAND
SUBJECT:
1. Claim on behalf of two former sales representatives for
enhanced redundancy lump sum payments.
BACKGROUND:
2. Both Companies carried on business in the sale of motor cycles
and motor mowers, generators and similar products. Up to the end
of 1988 the companies were staffed by a managing director and
twenty-two other employees of whom eight were monthly salaried
employees; the remainder being weekly wage earners.
3. At the end of 1988 the Companies decided to cease trading due
to a fall in business. Management entered into negotiations with
the Unions representing the weekly paid staff following which it
was agreed that these workers would be paid a weeks pay per year
of service in addition to their statutory redundancy lump sum
entitlements.
4. The workers here concerned received lump sum payments by way
of commutation of pension entitlement and reduced annual pension
as a result of their membership of a non-contributory pension
scheme. They also subsequently received payment of a statutory
redundancy lump sum payment. The workers then claimed payment of
enhanced redundancy payments in line with that paid to the other
workers who were made redundant. The companies rejected the
claim.
5. The workers then approached their Union who served a claim on
their behalf by letter dated 29th May, 1989. This claim was
rejected and the Union referred the issue to the conciliation
service of the Labour Court. The companies declined an invitation
to attend a conciliation conference and the Union then referred
the claim for investigation and recommendation by the Labour Court
under Section 20(1) of the Industrial Relations Act, 1969. The
Union agreed to be bound by the Court's recommendation. A Court
hearing was held on 2nd November, 1989.
UNION'S ARGUMENTS:
6. 1. Management has argued that because monthly salaried staff
received lump sum payments and pension from Irish Pensions
Trust special consideration was given to the weekly paid
workers, who were not in a pension scheme, in paying them
redundancy twice the statutory entitlements. However in
redundancy negotiations in which this Union has been involved
over the years there have never been any instances where
lesser or greater settlements were agreed due to the absence
or presence of pension scheme benefits.
2. The workers concerned received nothing more than their
legal pension entitlements from the Irish Pension Trust. No
extra monies or cost to the Company was involved.
3. It is the Unions understanding that the settlement of
twice the statutory was accepted due to the Company's pleas of
inability to pay more. The question of special consideration
being given to weekly paid staff did not arise. The Union
believes that the Company has recently sold premises for #1.5
million. However the Union is not seeking, as it may well be
entitled, more than the settlement agreed with the other
workers.
COMPANIES' ARGUMENTS:
7. 1. The sole reason for the Companies agreeing to pay the
weekly paid staff in excess of the statutory redundancy lump
sum was that the salaried staff would receive and did receive
substantial benefits as a result of their membership of a
pension scheme (details supplied to the Court). The weekly
paid staff received no benefits other than redundancy
payments.
2. The Companies had accumulated heavy losses over the years
before they decided to cease trading due to loss of business
(details supplied to the Court). Accordingly the Companies
could not afford to pay the workers here concerned more than
the statutory redundancy lump sum.
3. It is the Companies' view that salaried staff were not
discriminated against as their combined pension and redundancy
benefits exceeded that paid to the weekly paid staff.
RECOMMENDATION:
8. Having regard to the particular circumstances of this case and
usual practice in redundancy situations, the Court recommends
concession of the Union's claim.
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Signed on behalf of the Labour Court
Kevin Heffernan
_______________________
14th November, 1989 Chairman.
M.D./J.C.