Labour Court Database __________________________________________________________________________________ File Number: CD90272 Case Number: LCR12953 Section / Act: S67 Parties: NIXDORF COMPUTER INTERNATIONAL LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Dispute concerning the calculation of redundancy payments to cleaners.
Recommendation:
5. Having considered the submissions from the parties the Court
is not satisfied that there is merit in the Union's case and
accordingly does not recommend concession of the claim.
Division: Ms Owens Mr Collins Mr Devine
Text of Document__________________________________________________________________
CD90272 RECOMMENDATION NO. LCR12953
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: NIXDORF COMPUTER INTERNATIONAL LIMITED
(REPRESENTED BY THE FEDERATION OF IRISH EMPLOYERS)
AND
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Dispute concerning the calculation of redundancy payments to
cleaners.
BACKGROUND:
2. Following discussions on redundancy terms for workers employed
in the Bray plant, agreement was reached on the terms on 27th
February, 1990 as follows:
- six weeks' pay per year of service inclusive of statutory
redundancy entitlement.
- redundancies to be implemented on a last in first out basis,
in exceptional individual cases the Company to consider
volunteers at its absolute discretion.
- the terms of the agreement to apply in the event of further
redundancies.
Of the cleaners employed by the Company, those who were employed
in 1979 when the Company decided to take the cleaning function in
house rather than use contract cleaners, are paid #4.55 per hour,
while those cleaners taken on since 1984 are paid #3.39 per hour.
The Union is claiming that the higher rate should be used in the
calculation of all the cleaners redundancy payments. This was
rejected by the Company and the matter was subsequently referred
to the conciliation service of the Labour Court. A conciliation
conference was held on 24th May, 1990 at which agreement could not
be reached and on 25th May, 1990 the matter was referred to the
Labour Court for investigation and recommendation. The Court
investigated the dispute on 12th July, 1990.
UNION'S ARGUMENTS:
3. 1. The workers concerned had been individually discussing the
situation with the personnel department, in line with that
department's open door policy and were led to believe that the
situation would be rectified to their satisfaction. It was
not until after the redundancy package was negotiated that the
Union was instructed to make appropriate representations to
the Company on the anomaly that existed in the cleaners rates
of pay. If the Union had been aware of this before completing
the redundancy package it could and most probably would have
resolved the matter to the workers satisfaction there and
then. The Company has enjoyed the benefits of the lower rate
of pay since it was introduced many years ago. At no stage
was the Union consulted or advised of the two tier rate system
for the cleaning section and such a system is both
unacceptable and unreasonable where the particular group of
workers are doing exactly the same work.
2. The Company has argued that the claim is cost increasing
and contrary to the provisions of the Programme for National
Recovery (PNR). However, the Union took account of this in
amending its position from one of immediate application of the
higher rate to one of application of the higher rate in
calculation of redundancy payments. The Union has given an
assurance that consequential claims from other categories or a
claim for a restoration of the relative position from the
higher paid cleaners would not be supported or pursued by this
Union. The value of the redundancy package negotiated to
cover all workers is estimated at #3.5m. The Company has not
had to expend the total amount as a number of workers have
left the Company outside of the conditions of the severance
package thereby forfeiting their portion of the #3.5m.
Therefore, there is money available from the redundancy fund
to finance this claim. A reasonable approach was adopted by
the workers concerned and in all the circumstances the Union's
claim should be conceded.
COMPANY'S ARGUMENTS:
4. 1. The agreement reached in February, 1990 on the amount of
redundancy payments states that 6 weeks' pay per year of
service will be paid. If the Union had a different definition
of pay for any sector of the workforce then it should have
been discussed prior to registration of this agreement. Pay
is defined for the purposes of the redundancy payments acts as
average remuneration. The Company has strictly adhered to the
terms of the acts in taking two rates for cleaners as these
rates represent actual pay rates for redundancy purposes. The
Company agreed redundancy terms under a strict cost constraint
subject to rates in the Company at the time of redundancy. No
provision has been made for an increase in the redundancy
settlement for any one group and concession of this claim
would be an unforeseen cost factor at a time when the Company
is working to a strict budget.
4. 2. The higher rate for cleaners reflected the longer service
of those workers employed in 1979. In addition, there were
special circumstances pertaining to the workers on a higher
rate as they had previously worked on contract to the Company
and subsequently became employees of the Company. The
redundancy agreement was fully negotiated in joint
consultation and the Company has rigidly adhered to its side
of the agreement. The Company is not in a position to
renegotiate the redundancy package at this stage. In
addition, the PNR excludes any claims of a cost increasing
nature and therefore this claim should be excluded from
consideration by the Court. Concession of the Union's claim
could lead to consequential claims and in all the
circumstances should be rejected.
RECOMMENDATION:
5. Having considered the submissions from the parties the Court
is not satisfied that there is merit in the Union's case and
accordingly does not recommend concession of the claim.
~
Signed on behalf of the Labour Court,
Evelyn Owens
___20th___July,____1990. ___________________
U. M. / M. F. Deputy Chairman