Labour Court Database __________________________________________________________________________________ File Number: CD91215 Case Number: LCR13444 Section / Act: S20(1) Parties: AUSTIN ROVER - and - TWO WORKERS |
Claim by two workers for the payment of interest on their pension contributions.
Recommendation:
5. The Court has considered the submissions made by the parties
and having regard to the terms of the Agreement under which the
workers concerned terminated their employment the Court does not
recommend that their claim be conceded.
Division: Mr O'Connell Mr Brennan Mr Rorke
Text of Document__________________________________________________________________
CD91215 RECOMMENDATION NO. LCR13444
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 20(1), INDUSTRIAL RELATIONS ACT 1969
PARTIES: AUSTIN ROVER
(REPRESENTED BY MR. ERCUS STEWART S.C.
INSTRUCTED BY T.P. ROBINSON AND COMPANY SOLICITORS)
and
TWO WORKERS
SUBJECT:
1. Claim by two workers for the payment of interest on their
pension contributions.
BACKGROUND:
2. The workers concerned were declared redundant by the Company
in December, 1986 and received a refund of their pension
contributions in January, 1987. Subsequently one of the workers
contacted the Company and claimed that any interest which accrued
on his pension contributions should be paid to him. The Company
rejected the claim. In October, 1987 the worker referred the
issue to a Rights Commissioner for investigation but the Company
objected to such an investigation. On the 16th May, 1991 both
workers referred the dispute to the Labour Court for investigation
and recommendation under Section 20(1) of the Industrial Relations
Act, 1969. The workers agreed to be bound by the Court's
recommendation. A Court hearing was held on the 2nd October,
1991.
WORKER'S ARGUMENTS:
3. 1. The workers concerned were very disappointed with the
amount of money they received by way of refund of their
pension contributions. If these contributions had been lodged
in a financial institution interest would have accrued to the
workers. They are not entitled to the portion of the
contributions paid into the scheme by the employer and the
contributions of the workers have earned them no interest.
What was supposed to have been a 'perk of the job' has been of
no benefit whatsoever to the workers. The contributions must
have made a profit for someone as the pension fund is now
oversubscribed.
2. The Court investigated a similar claim in 1987 concerning
the pension scheme operated in Irish Industrial Gases and
recommended that "members of the scheme made redundant should
receive interest on their refund of contributions." (L.C.R.
10972 refers). In the opinion of the workers concerned that
case has clearly established a precedent for their claim.
COMPANY'S ARGUMENTS:
4. 1. The two workers concerned received the sums of #16,665.67
and #13,348.27 on the 6th January, 1987. They acknowledged in
writing that these payments were "in full and final settlement
of all claims arising directly or indirectly out of the
termination of their contracts of employment." They agreed
"absolutely and finally to discharge and indemnify Austin
Rover Ireland Limited from all claims by them of whatever
nature arising out of the said termination of their employment
under all the terms of that contract and, in particular,
acknowledge that they waive all rights or claims now vested in
them by virtue of the Trades Disputes Act, 1906, the Unfair
Dismissals Act, 1977, the Minimum Notice and Terms of
Employment Act, 1973 and the Redundancy Payments Acts,
1967-1979 and the Industrial Relations Acts, 1946 to 1969."
The claimants accepted payments on the termination of their
employments in full and final settlement of any claim they had
against their former employer. There is therefore now no
valid claim against the Company. In all disputes between
employers and workers, where a settlement has been reached,
the parties must abide by the settlement.
2. In 1987 when the dispute was referred to a Rights
Commissioner, an executive of the Company, who was a trustee
of the pension fund, wrote to the Labour Court, and explained
his responsibility to ensure that the fund was administered in
accordance with the trust deed. The letter stated that "on
joining the pension scheme the worker signed a document
agreeing to be bound by the Rules of the Scheme. He was
provided with a copy of the Rules." The trustees have
complied with the Rules of the Scheme, which were accepted by
the claimants while in employment. The fund was established
and documented on the basis that interest was not paid on
withdrawal from service.
3. A precedent has not been established for the workers'
claim by the Irish Gases case. In that case the Court
recommended an amendment to an existing pension scheme in
relation to the current workforce, and not in relation to
workers who had left the employment some four and a half years
previously.
RECOMMENDATION:
5. The Court has considered the submissions made by the parties
and having regard to the terms of the Agreement under which the
workers concerned terminated their employment the Court does not
recommend that their claim be conceded.
~
Signed on behalf of the Labour Court
John O'Connell
_________________________
15th October, 1991. Deputy Chairman
T.O'D./J.C.