Labour Court Database __________________________________________________________________________________ File Number: CD91645 Case Number: LCR13713 Section / Act: S26(1) Parties: CAVAN IRISH CRYSTAL LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Dispute concerning the method of implementation of a redundancy programme.
Recommendation:
5. The Court, having considered the submissions of both parties
and the difficulties facing both the workers and the management,
recommend that the parties agree a phased voluntary redundancy
programme over a three to five year period.
The funding of the redundancy programme if it is to be achieved
voluntarily would, as the Court sees it, have to be assisted by
concessions on the part of the remaining workforce.
This would require negotiation and should include a modest once
off compensation figure for below grade working at the appropriate
grade rate.
Given the economic constraints at this time acknowledged by the
parties the Court recommends that whatever package of proposals is
agreed should be jointly reviewed at the end of the 3/5 years
period.
The Court will be available to assist if the parties fail to reach
agreement on a compensation or redundancy figure.
Division: Ms Owens Mr Keogh Ms Ni Mhurchu
Text of Document__________________________________________________________________
CD91645 RECOMMENDATION NO. LCR13713
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: CAVAN IRISH CRYSTAL LIMITED
(REPRESENTED BY THE FEDERATION OF IRISH EMPLOYERS)
AND
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Dispute concerning the method of implementation of a
redundancy programme.
BACKGROUND:
2. The Company has been in operation for approximately 22 years
and employs 63 staff in total. It went into receivership in 1983
and has a history of trading difficulties. For the last 4 to 5
years the workers have been on short-time or lay-off for
substantial periods of each year. Due mainly to a fall off in
product demand it is unlikely that the Company will return to
full-time working in the foreseeable future. In 1990 the Union
sought a voluntary redundancy package for the workers as full-time
working could not be guaranteed. The matter was referred to the
Labour Relations Commission and was resolved at a conciliation
conference in July, 1990 on the basis that work was guaranteed up
to the end of September, 1990. Further short-time working
commenced in January, 1991 and continued up to June, 1991. The
matter was referred back to the Labour Relations Commission on 8th
July, 1991. The Union's claim is that surplus staff should be
eliminated by means of phased voluntary redundancies over 3 to 4
years. The severance terms should be no less that the established
norm in the area (i.e. 5 weeks per year of service plus statutory
entitlements). The Company claims that it is not in a position to
fund a redundancy programme at the level claimed by the Union. No
agreement was reached at the conciliation conference and the
dispute was referred to the Labour Court on 2nd December, 1991 in
accordance with Section 26(1) of the Industrial Relations Act,
1990. The Court investigated the dispute in Cavan on 24th June,
1992 (the earliest date suitable to the parties).
UNION'S ARGUMENTS:
3. 1. Short-time working has operated at the Company over the
last 6 years. Most of the workers have worked approximately
60% of their normal working hours. The abolition of Pay
Related Benefit for those on systematic short-time working
has reduced their incomes significantly. As full-time
working is unlikely to be achieved in the foreseeable future
the Company should provide a reasonable voluntary redundancy
package. The indefinite continuation of short-term working
is unacceptable.
2. If the Company is unable to fund a voluntary redundancy
programme immediately then it could be implemented on a
phased basis. Surplus staff could be eliminated by means of
voluntary redundancy over a period of 3 to 4 years. The
workers are entitled to substantial compensation which should
be no less than the established norm in the area.
COMPANY'S ARGUMENTS:
4. 1. The Company is operating within tight financial
constraints and in a market which is extremely depressed and
over supplied. There is need for rationalisation with
reduced staffing levels.
2. The Company has not generated sufficient profits in the
past to fund an enhanced redundancy package. A
rationalisation programme would not generate sufficient
savings to fund such a package. The Company must achieve the
required number of redundancies at an affordable price. The
Company has proposed 3 affordable options for a redundancy
programme (details supplied to the Court) which were rejected
by the Union.
3. In recent years the Company has had extensive short-time
working on the factory floor. Staff have maintained their
original rate regardless of the actual job they do when in
work. The Company must replace the existing practice of
maintaining historical rates with a pay structure based on
payment according to the value of the job done.
4. Redundancy costs are of crucial importance to the
Company and represent a key factor in its survival plan.
While the method of implementation is an area for discussion
the funding of the redundancy programme must be at a modest
cost. Such a programme must be assisted by concessions on
the part of the workforce.
RECOMMENDATION:
5. The Court, having considered the submissions of both parties
and the difficulties facing both the workers and the management,
recommend that the parties agree a phased voluntary redundancy
programme over a three to five year period.
The funding of the redundancy programme if it is to be achieved
voluntarily would, as the Court sees it, have to be assisted by
concessions on the part of the remaining workforce.
This would require negotiation and should include a modest once
off compensation figure for below grade working at the appropriate
grade rate.
Given the economic constraints at this time acknowledged by the
parties the Court recommends that whatever package of proposals is
agreed should be jointly reviewed at the end of the 3/5 years
period.
The Court will be available to assist if the parties fail to reach
agreement on a compensation or redundancy figure.
~
Signed on behalf of the Labour Court
Evelyn Owens
21st July, 1992 ------------------------------------
A.S./M.H.
Deputy Chairman.
NOTE
Enquiries concerning this Recommendation should be addressed to
Mr. Alfie Smith, Court Secretary.