Labour Court Database __________________________________________________________________________________ File Number: CD91374 Case Number: LCR13398 Section / Act: S26(1) Parties: GILBEYS OF IRELAND SALES LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Claim by the Union on behalf of 7 transport workers for enhanced severance terms.
Recommendation:
5. The Court, having considered the submissions made by the
parties, recommends that the proposal recorded by the Industrial
Relations Officer at the conferences on 16th May, amended to
include the loyalty bonus should be offered by the Company and
accepted by the workers concerned.
Division: Mr O'Connell Mr McHenry Ms Ni Mhurchu
Text of Document__________________________________________________________________
CD91374 RECOMMENDATION NO. LCR13398
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: GILBEYS OF IRELAND SALES LIMITED
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Claim by the Union on behalf of 7 transport workers for
enhanced severance terms.
BACKGROUND:
2. In June, 1990, the Company informed the Union that it intended
to review its distribution practices with a view to increasing
cost effectiveness. The Company requested that a Working
Committee, with staff involvement, be set up to examine the
optimum warehousing and distribution requirements to meet the
Company's needs in the 1990's. This Committee examined two
possibilities:-
(a) The changes to existing systems required to meet market
needs - increases flexibility and reduce costs.
(b) The contracting out of warehousing and distribution to a
3rd party.
In January, 1991, the Company informed the Union that it had
decided upon a compromise solution as follows:-
(i) Retention of warehousing operations while changing
systems and work practices.
(ii) Establish an "Owner Driver Contract Delivery Service" -
giving existing transport staff the first opportunity to
apply.
Owner Driver Contracts should be offered to 5 of the 7 workers.
The Union reluctantly agreed to this solution and negotiations on
severance terms began in March, 1991. The redundancies involve 7
workers, 4 drivers and 3 helpers. The Company offered 5 weeks
average pay per year of service, plus statutory entitlements with
a ceiling of 2 years wages. (The Company subsequently added a
£2,000 loyalty bonus). The Union rejected the offer, claiming 8
weeks pay per year of service, no ceiling and compensation for
loss of income. Despite further local negotiations, no agreement
could be reached and the matter was referred to the conciliation
service of the Labour Relations Commission on 16th April, 1991.
During conciliation conferences held on 16th May, 1991, and 4th
June, 1991, the Industrial Relations Officer proposed the
following solution.
(i) No change in Company offer of 5 weeks pay per year of
service plus statutory, with 2 year ceiling.
(ii) Deletion of £2,000 loyalty bonus.
(iii) Inclusion of £40 per week expenses (to a maximum of 2
years expenses) into the package at (i) above.
(iv) If the offer is rejected by either side, it has no status
and is withdrawn.
The offer was not acceptable to the Union. As agreement could not
be reached the Labour Relations Commission in accordance with
Section 26(1)(a)(b) of the Industrial Relations Act, 1990,
referred the matter, on 19th July, 1991, to the Labour Court for
investigation and recommendation. The Court investigated the
dispute on 6th August, 1991.
UNION'S ARGUMENTS:
3. 1. The Union believes that this situation should be viewed as
specific and unique. The Company is anxious to "hold the
time" on redundancy payments because of future operational and
relocational changes in its production plants. However, the
Union contends that this transport deal and any other set of
negotiations will have to be argued on their own merits and on
a "stand-alone" basis.
2. The Company's proposal to change its distribution service
has not come about because of its desire to improve its
service and increase sales, nor because of any loss of
business. The Company is a highly profitable one and is well
able to afford a generous redundancy settlement especially
given the considerable ongoing saving resulting from the
redundancies.
3. The workers concerned have service ranging from 11 years
to 47 years with the Company (full details provided). The
ceiling being imposed by the Company is as a result,
particularly unfair on long serving workers. In effect, it
reduces their redundancy pay to a sum equivalent to 2 weeks
pay per year of service.
COMPANY'S ARGUMENTS:
4. 1. The Company must change the distribution system in order
to remain competitive and provide customers with a high
quality, flexible and efficient delivery service.
2. The Company's proposals minimise the hardship and provides
employment for most of those affected. The provision of Owner
Driver Contracts makes for a very reasonable opportunity. The
alternative solution, contracting out warehousing and
distribution, would make a further 12 people redundant in
warehousing.
3. The Company's offer of 5 week's average pay per year of
service compares very favourably with prevailing rates.
RECOMMENDATION:
5. The Court, having considered the submissions made by the
parties, recommends that the proposal recorded by the Industrial
Relations Officer at the conferences on 16th May, amended to
include the loyalty bonus should be offered by the Company and
accepted by the workers concerned.
~
Signed on behalf of the Labour Court
John O'Connell
______________________
3rd September, 1991. Deputy Chairman
B.O'N/J.C.