Labour Court Database __________________________________________________________________________________ File Number: CD90712 Case Number: LCR13192 Section / Act: S67 Parties: TILLITSON LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Claim for increases in a) Redundancy compensation b) Compensation for shift transfer c) Compensation for loss in grade
Recommendation:
5. Having considered the submissions from the parties the Court
is of the view that the Company's offer with regard to loss of
shift and compensation for loss of grade is reasonable in the
circumstances and should be accepted. The Court recommends that
the Company's offer in relation to redundancy should be increased
to 3 week's (inclusive of statutory) per year of service.
The Court so recommends.
Division: Ms Owens Mr Collins Mr Walsh
Text of Document__________________________________________________________________
CD90712 RECOMMENDATION NO. LCR13192
THE LABOUR COURT
INDUSTRIAL RELATIONS ACTS 1946 TO 1976
SECTION 67
PARTIES: TILLITSON LIMITED
(Represented by the Federation of Irish Employers)
AND
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Claim for increases in a) Redundancy compensation
b) Compensation for shift transfer
c) Compensation for loss in grade
BACKGROUND:
2. 1. The Company is a manufacturer of carburetors for hand
held tools, chainsaws, lawnmowers etc. Two hundred people
are employed which has been reduced from a figure of 250 at
the beginning of 1989. The market for the Company's products
has declined in recent times due to a number of factors
(details supplied to the Court). The annual monthly figures
for carburetor construction of 100,000 units per month fell
to approximately 60,000 to 70,000 per month. As a result
voluntary short-time working began in January 1990 and a
further reduction in orders in February 1990 led to further
measures being taken. A voluntary severance package was on
offer throughout the year. The level of volunteers was not
sufficient to meet managements requirements and a
rationalisation programme was developed to reduce operating
costs and staffing levels compatible with an order volume of
70,000 units per month.
2. The terms of the rationalisation plan presented to the
Union in October 1990 were:
a) Redundancy
Compensation offered of 2 weeks' pay per year of service
inclusive of statutory entitlements plus payment in lieu of
notice.
b) Compensation for loss in grade
Payment would be in line with a previous settlement in 1984,
the equivalent of 12 months of the differential lost by
employees transferring from indirect areas to direct areas.
c) Compensation for loss in shift
Payment would be in line with a previous settlement of 1982,
9 weeks shift premium payable in a manner which best suited
each individual.
3. Full agreement could not be reached locally and the
matter was referred to the Conciliation Service of the Labour
Court on the 13th September, 1990. A conciliation conference
was held on 16 November, 1990. The issues were not resolved
and the Union referred the case to the Court for a full
hearing. A Labour Court investigation took place in Limerick
on 29 January, 1991.
UNION'S ARGUMENTS:
3. 1. There is a recognition among members that the Company is
endeavoring to overcome trading difficulties but there is a
feeling that it could make a better effort to alleviate the
hardship caused. The Union membership have been extremely
constructive in its approach to helping the Company overcome
its problems and have agreed to short-time working in the
areas most affected while the claims are being processed.
The Union is extremely anxious that this dispute be resolved
amicably.
a) Redundancy
The Company's offer of 2 weeks' pay per year of service
inclusive of statutory where practical was regarded as
inadequate by the majority of members. Some members opted to
take redundancy on these terms rather than face redeployment
or downgrading. This was not objected to by other members.
The redundancy package offered would be considered lower than
the norm for the region and indeed the country (details
supplied to the Court).
b) Compensation for shift transfer
Many and varied arrangements exist for this type of
compensation, the most common being a phasing out arrangement
over a prolonged period of time. In some cases the shift
allowance has been retained. The Company's shift
arrangements differ from the norm as the workers are on
continuous shift. This increases the loss to 25% of basic
pay. The Company's offer of compensation of 10 weeks shift
allowance, is inadequate and should be increased to the
equivalent of 2 years loss.
c) Compensation for loss in grade
The Company are offering 1 years loss based on a 1984
agreement which the Union feel is dated. The workers are
seeking that this be updated to 2 years loss. Workers who
have worked hard to gain promotion can feel aggrieved that
this should be taken away from them, coupled with loss of
earnings this can have a serious impact on the workers.
EMPLOYER'S ARGUMENTS:
4. 1. The accumulated losses in the Company for 1990 is of the
order of #500,000. The presentation of the survival plan to
ensure that the business remains viable must be seen against
a background of necessity. On concluding conciliation,
management were of the impression that the issues of
compensation for transfer and the compensation for loss of
shift has been agreed. Both levels of compensation have been
established by precedent and are in line with the sum of
money available.
2. The Court should be sensitive to the fact that the
current uncertainty in the gulf and the ongoing weakness of
the US dollar is continuing to put pressure on the commercial
viability of the Company. This outside pressure only adds to
the reduction in the volume of orders in the past year. The
redundancy compensation offer must be seen in this light as
it reflects the very severe cash shortage which the Company
faces. Indeed management have been forced at times to advise
employees that they may be obliged to work out their notice
period as it was not possible to make the necessary one off
payment of cash in lieu of notice.
3. At this time there remains only one employee to be made
redundant and the numbers of redundancies originally required
have been reduced by the fact that 3 quality control
personnel have agreed to work on a job sharing basis. In
addition only 1 employee was redeployed and no other
redeployment is pending. Regarding the redeployment of night
shift staff to days, this will not be done until there is
sufficient work on days to merit the transfer. However, in
the light of recent events it may be necessary to consider
further redundancies in the machine shop area as the overall
level of monthly orders has declined.
RECOMMENDATION:
5. Having considered the submissions from the parties the Court
is of the view that the Company's offer with regard to loss of
shift and compensation for loss of grade is reasonable in the
circumstances and should be accepted. The Court recommends that
the Company's offer in relation to redundancy should be increased
to 3 weeks (inclusive of statutory) per year of service.
The Court so recommends.
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Signed on behalf of the Labour Court
19th February, 1991 Evelyn Owens
J.F./M.O'C. _______________
Deputy Chairman