Labour Court Database __________________________________________________________________________________ File Number: CD90639 Case Number: LCR13132 Section / Act: S67 Parties: CAHILL MAY ROBERTS LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Dispute concerning redundancy terms for a worker.
Recommendation:
5. In the light of the submissions made by the parties the Court
is of the opinion that, having regard to the circumstances of the
case, concession of the Union's claim is not warranted. The
Court, noting the Company's willingness to deal sympathetically
with the worker concerned, and taking into account the level of
his pension entitlement available at age 65, recommends that the
Company on an ex gratia basis increase the lump sum element of its
offer to #30,000 and that this offer so amended be accepted by the
worker concerned.
The Court also recommends that the Company should pay sick pay
from the date it ceased to the date of issue of this
recommendation.
Division: Mr O'Connell Mr Keogh Mr Rorke
Text of Document__________________________________________________________________
CD90639 RECOMMENDATION NO. LCR13132
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: CAHILL MAY ROBERTS LIMITED
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Dispute concerning redundancy terms for a worker.
BACKGROUND:
2. The worker concerned is aged 55 years and has 41 years service
with the Company. During that time he served in a number of
positions, mainly as a driver and later as a branch manager. In
1988 there was a recurrence of an illness the worker suffered in
1982, (details supplied to the Court) which resulted in an absence
from work of 20 weeks in 1989 and 14 weeks in 1990 on full sick
pay. In August, 1990 because of his prolonged absence the Company
informed the worker that it was no longer in a position to pay his
salary. The parties then entered negotiations on what voluntary
early retirement/redundancy package might be available to the
worker. The Company offered the agreed maximum package available
in a redundancy situation i.e. a cash lump sum of #25,000 based on
4 weeks pay per year of service plus statutory entitlements
subject to a maximum cost to the Company of one and one half times
the worker's annual salary. There is also an immediate pension
entitlement of approximately #2,000 which increases to
approximately #5,700 at age 65 years. The Union claims that the
worker has a special case and that due to his exceptional service
the lump sum should be calculated on the basis of 5 weeks per year
of service with an extension of the ceiling to 3 times the
worker's annual salary. The worker should also receive a full
pension immediately with no discounting for the fact that is would
be paid nine years early and no offsetting for state pension until
age 65. No agreement was reached between the parties and the
matter was referred on 25th October, 1990 to the conciliation
service of the Labour Court. A conciliation conference was held
2nd November, 1990 at which no agreement was reached and the
matter was referred on that date to a full hearing of the Labour
Court. The hearing took place on 3rd December, 1990.
UNION'S ARGUMENTS:
3. 1. This is an exceptional case as the worker concerned is 55
years of age and has 41 years loyal and committed service.
The worker's absence due to illness has only occurred in the
last few years. The circumstances are unique and require a
much more compassionate approach from the Company than what
has been evident to date.
2. The Company has had a number of voluntary severance
redundancies over the years, most if not all of which would
have involved younger staff with less service than the worker
concerned. It is also questionable how voluntary the
severance is in this case as following the recurrence of his
illness the worker was given work which was not meaningful or
suitable. This put pressure on him and may have compounded
his problems.
3. In previous voluntary redundancy situations the ceiling of
one and one half times the worker's annual salary had little
or no effect due to the relatively short service of the staff
concerned. As the worker concerned has exceptional service
the lump sum ceiling should be seriously examined. A three
years salary ceiling would be far more realistic.
4. The worker finds himself in the unfortunate position of
not having a full pension after 41 years' service. Most
reputable employers negotiate voluntary severance/early
retirement packages where full pension is available from 55
years upwards or they reduce the discounting factor to 2% or
3%. In the worker's case there is a discounting factor of 7%
per annum.
COMPANY'S ARGUMENTS:
4. 1. The Company has been extremely generous and sympathetic in
its treatment of the worker. The severity of the worker's
illness necessitated a change of job and a consequent transfer
to Chapelizod in 1986. Attendance at work subsequently was on
a part-time basis and the Company sought to place him in
positions which would not compound his illness. During this
time the worker was retained on his full rate of pay.
2. The level of sickness payment afforded to the worker
during his prolonged illness far exceeded the agreed level in
these matters and that previously afforded to other workers.
3. The Company has never sought to terminate the employment
of the worker. The scale of payment in the proposed package
reflects the maximum payable in a redundancy situation and is
fair and reasonable.
RECOMMENDATION;
5. In the light of the submissions made by the parties the Court
is of the opinion that, having regard to the circumstances of the
case, concession of the Union's claim is not warranted. The
Court, noting the Company's willingness to deal sympathetically
with the worker concerned, and taking into account the level of
his pension entitlement available at age 65, recommends that the
Company on an ex gratia basis increase the lump sum element of its
offer to #30,000 and that this offer so amended be accepted by the
worker concerned.
The Court also recommends that the Company should pay sick pay
from the date it ceased to the date of issue of this
recommendation.
~
Signed on behalf of the Labour Court
John O'Connell
________________________
19th December, 1990. Deputy Chairman
A.S./J.C.