Labour Court Database __________________________________________________________________________________ File Number: CD90242 Case Number: LCR12909 Section / Act: S67 Parties: YOUGHAL CARPET (YARNS) LIMITED - and - IRISH DISTRIBUTIVE AND ADMINISTRATIVE TRADE UNION |
Claim by the Company concerning the redundancy of three supervisory positions in the context of a rationalisation programme.
Recommendation:
5. The Court has considered the submissions made by the parties.
On the question of the proposed re-organisation of the supervisors
tasks, the Court takes the view that it is clearly management's
responsibility to decide on the level of supervision deemed
necessary.
The Court therefore, in the light of the Company's current trading
situation and the clear need to rationalise its production methods
recommends that subject to the payment of similarly amended
redundancy payments recommended for managerial staff, the
Company's proposals on supervisory manning be accepted.
Division: Mr O'Connell Mr McHenry Mr Walsh
Text of Document__________________________________________________________________
CD90242 RECOMMENDATION NO. LCR12909
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: YOUGHAL CARPET (YARNS) LIMITED
and
IRISH DISTRIBUTIVE AND ADMINISTRATIVE TRADE UNION
SUBJECT:
1. Claim by the Company concerning the redundancy of three
supervisory positions in the context of a rationalisation
programme.
BACKGROUND:
2. The Company, in February, 1990, indicated that due to a number
of trading factors, such as a reduction in both prices and demand
and the strength of the punt against sterling, it urgently
requires savings. The Company has decided to obtain these savings
through a reduction in staff numbers. Three positions in the
supervisory group are scheduled for redundancy. Two departments,
reeling and twisting, which are operationally linked, are to be
operated as one. This would have resulted in two redundancies.
The remaining position in the Dyehouse is being phased out but the
present holder will transfer to the assistant dyer's job. As a
result of a recent resignation the Company proposes to transfer
one of the three redundant supervisors to the Quality Control
Department. This leaves only one actual redundancy. The Company
also proposed for organisational reasons to return a supervisor to
a two shift rota and for two supervisors to move from a two shift
to a three shift rota. The Union rejected the Company's proposals
and on 18th April, 1990, the dispute was referred to the
conciliation service of the Labour Court. At a conciliation
conference, held on 20th April, 1990, the Company offered a
redundancy settlement of twice statutory entitlements. This was
rejected by the Union who disagree with the need for redundancies
in this area. As agreement could not be reached the matter was
referred to the Labour Court on 21st May, 1990, for investigation
and recommendation. The Court investigated the dispute on 24th
May, 1990.
COMPANY'S ARGUMENTS:
3. 1. The Company is facing fierce price competition and a
worsening demand for its products. Output has dropped by 20%
compared to the previous 18 months, resulting in serious fixed
cost escalation. The Company has been compelled to seek a
reduction in indirect fixed costs. The savings thus generated
will be applied to reduce selling prices and hopefully
increase sales volumes, which are critical in a volume
sensitive plant.
2. The Company must achieve the savings involved to remain
viable and secure the remaining jobs. Failure to achieve
these savings will lead to much more serious consequences and
threaten the future viability of the Company. The
rationalisation plan has been designed to ensure that earnings
of the remaining employees are not affected.
3. The Company is offering a redundancy settlement of twice
statutory entitlements plus a lump sum of #450 for those with
over 7 years service. The Company will select those to be
made redundant on a seniority basis, retaining the longest
serving employees in so far as this is possible.
UNION'S ARGUMENTS:
4. 1. The Company's proposals to reduce the supervisory
numbers by three is a significant reduction in an already
small supervisory staff. The amalgamation of the supervisory
duties in the Reeling and Twisting Departments in effect,
means that where a shift previously had eight supervisors then
reduced to five will now be supervised by three supervisors.
This involves such a dramatic increase in supervisory
responsibilities that the situation will be totally
unmanageable.
2. The proposed increase in workload (approximately a two
thirds increase) is unrealistic and will create impossible
practical problems. It will also come at a time when the
Company is trying to achieve the ISO 9002 quality mark, which
will require more quality control and supervision. Reduced
supervision will increase the margin of error and cost the
Company thousands of pounds.
3. The proposed reduction in supervisory staff is
proportionately larger than that proposed for general workers
where there are more volunteers for redundancy than are
required. The redundancy terms are derisory when one
considers that the last redundancies that took place among
this group was on a voluntary basis with three and a half
weeks pay per year of service being offered.
4. 4. The Company's assertion that the loss of the three
supervisory posts will only involve one redundancy does not
make the proposals more acceptable because the overall effect
of the loss of the posts on the remaining supervisors is
unacceptable.
5. The proposed arrangements involve a worsening of
conditions for the supervisor who must move from day duties to
two shift operations and for two other supervisors who must
move to from two shift to three shift working. This is
totally unacceptable to the Union.
RECOMMENDATION:
5. The Court has considered the submissions made by the parties.
On the question of the proposed re-organisation of the supervisors
tasks, the Court takes the view that it is clearly management's
responsibility to decide on the level of supervision deemed
necessary.
The Court therefore, in the light of the Company's current trading
situation and the clear need to rationalise its production methods
recommends that subject to the payment of similarly amended
redundancy payments recommended for managerial staff, the
Company's proposals on supervisory manning be accepted.
~
Signed on behalf of the Labour Court
John O'Connell
11th June, 1990 ---------------
B O'N/U.S. Deputy Chairman