Labour Court Database __________________________________________________________________________________ File Number: CD90546 Case Number: LCR13075 Section / Act: S67 Parties: BRAUN IRELAND LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Claim by the Union on behalf of two workers for admission to the Company's disablement benefit plan.
Recommendation:
6. Having considered all the evidence presented in this case and
taking into account the provisions of the agreed scheme the Court
is of the view that the Company's proposed method of dealing with
the two claims is fair and reasonable in the circumstances and
accordingly the Court recommends that the Union accept this
proposal.
In order to avoid similar problems which may arise in the future
the Court further recommends that the parties meet to discuss and
clarify those clauses in the scheme which have given rise to
misunderstanding or doubt.
Division: Ms Owens Mr McHenry Mr Devine
Text of Document__________________________________________________________________
CD90546 RECOMMENDATION NO. LCR13075
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 67
PARTIES: BRAUN IRELAND LIMITED
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Claim by the Union on behalf of two workers for admission to
the Company's disablement benefit plan.
BACKGROUND:
2. In 1975 the Company set up a retirement and death benefit plan
and a disablement benefit plan for its employees. In 1982 the
disablement benefit plan was substantially improved and provides,
after six months absence, for the payment of 50% of annual salary
inclusive of state disability benefit and is not related to
pensionable service. The retirement and death benefit plan is
funded by Company and employee contributions. The disablement
benefit plan is funded solely by the Company which retains the
discretion on the admission of claims under the plan. If a worker
qualifies under the disablement benefit plan the Company pays the
full contribution towards the retirement and death benefit plan
for that worker so that entitlements under that plan are not
affected. In 1988 two workers were involved in separate car
accidents and had claims pending against third parties. When the
workers requested disablement benefit plan claim forms, the
Company responded that payment under the plan is at the discretion
of the Company, and that in cases where claims are pending
involving a third party which would compensate for loss of
earnings, the Company does not process applications to its own
insurance company.
3. The operation of the pension fund is monitored by a joint
Company/Union Committee and following further consideration the
Company decided that if a worker's solicitor undertook to include
in any claim for losses and damages the amount that may be paid to
the workers at the discretion of the Company's own insurance
company, and further undertook that in the event of such a claim
being successful, that a refund of said amount would be
re-imbursed to the trustees of the pension fund, then the Company
on receipt of such letters would process the claims. The Union
claims that the disablement benefit plan is incorporated in the
members pension scheme and has nothing to do with accident
insurance claims. The workers concerned should be entitled to the
benefits of the scheme and and any compensation for loss of
earnings obtained from a third party should not have any affect on
their entitlement. The Company rejects the claim. No agreement
was reached at local level and the matter was referred on 12th
April, 1990 to the conciliation service of the Labour Court. A
conciliation conference was held on 28th June, 1990 at which no
agreement was reached and the matter was referred on 11th
September, 1990 to a full hearing of the Labour Court. The
hearing took place in Kilkenny on 9th October, 1990.
UNION'S ARGUMENTS:
4. 1. The workers concerned are being refused payment of
disablement benefit on the basis that they will not undertake,
as requested by the Company, to repay money paid through the
plan from any settlement they may receive through third party
insurance claims resulting from their accidents. The Union's
legal advice is that the law courts do not take into account
any money received from a pension insurance plan which an
individual may have an income from. The Company's argument
that the law courts would compensate for loss of earnings and
that there would therefore be a double payment involved is not
correct.
2. The provision which the Company is attempting to implement
was never agreed by the members of the pension scheme. The
circumstances under which payments are not made under the plan
are clearly documented and there is no mention whatsoever of
workers pursuing claims as a result of car accidents.
3. Many workers have received payment in the past from the
scheme while at the same time they pursued and successfully
concluded compensation claims for injury received at work.
The Company did not seek to recoup payments from those
settlements and should not adopt a different approach to the
workers' third party claims.
4. The Company is denying benefit payments to workers who
joined the pension plan on the basis that disablement was
incorporated in the scheme. The refusal of disablement
benefit to the workers concerned has drastic repercussions on
their retirement pension as the Company has ceased to pay
contributions to the retirement and death benefit plan.
COMPANY'S ARGUMENTS:
5. 1. The Company's pension scheme is optional and contributory.
Each employee is furnished with a booklet outlining the
benefits and conditions for availing of the scheme. Payment
under the disablement benefit plan has always been at the
Company's discretion and the Company reserves the right to
exercise its discretion.
2. The Company is obliged to manage the scheme efficiently
and provide for the genuine needs of its employees. After
exercising its discretionary right the Company made a fair and
reasonable offer to provide payment in the interim period
until such time as a worker resumes employment and the third
party claim is settled. In this way the Company is
re-imbursed if the claim is successful and suffers no increase
in insurance premium. If the claim is not successful then the
worker suffers no loss.
3. The Company has used it discretion to avoid a situation
where a worker would be paid under its plan and also be
compensated on the double by a civil court. It would be
unfair for the Company to suffer a loss due to an accident
involving a third party. The Company's approach is now the
standard policy in the insurance business and the Company's
discretionary right with regard to payment under the plan must
be upheld.
RECOMMENDATION:
6. Having considered all the evidence presented in this case and
taking into account the provisions of the agreed scheme the Court
is of the view that the Company's proposed method of dealing with
the two claims is fair and reasonable in the circumstances and
accordingly the Court recommends that the Union accept this
proposal.
In order to avoid similar problems which may arise in the future
the Court further recommends that the parties meet to discuss and
clarify those clauses in the scheme which have given rise to
misunderstanding or doubt.
~
Signed on behalf of the Labour Court
Evelyn Owens
________________________
5th November, 1990. deputy chairman
A.S./J.C.