Labour Court Database __________________________________________________________________________________ File Number: CD92187 Case Number: LCR13658 Section / Act: S26(1) Parties: CONTAINERS AND PRESSURE VESSELS LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Dispute concerning the redundancy of a worker.
Recommendation:
The Court has given careful consideration to all the points both
written and oral made by the parties in this dispute. The Court
also had sight of the special report prepared for the Company
which they submitted was the basis on which they decided to take
the action they did.
The claimant had a long and exemplary record in the Company
having worked his way up to the position of Personnel Manager.
Whilst noting the Company's arguments supporting their case for
declaring the claimant redundant under the provisions of the
Redundancy Payments Act as amended the Court nevertheless is
satisfied that he was treated unfairly and that with goodwill it
should have been possible to retain him in employment in the
Company at an appropriate level.
The Court accordingly recommends concession of the Union's claim
that the claimant be re-instated.
Division: Ms Owens Mr Brennan Ms Ni Mhurchu
Text of Document__________________________________________________________________
CD92187 RECOMMENDATION NO. LCR13658
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: CONTAINERS AND PRESSURE VESSELS LIMITED
(Represented by the Federation of Irish Employers)
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Dispute concerning the redundancy of a worker.
BACKGROUND:
2. The Company manufactures stainless steel tanks and has a
workforce of 160, of whom 120 are production workers. The
worker concerned commenced employment with the Company in 1970
as a general operative and by 1984 had worked his way up the
ranks to the position of Personnel Manager. In early 1991 the
Company hired a firm of consultants to re-evaluate its
manufacturing process which the Company felt had become
uncompetitive. The consultants recommended the introduction of
world class manufacturing techniques. In late 1991 the Company
employed an operations manager with expertise in that field.
The Company claims that the changes in management style
following the introduction of world class manufacturing meant
that the personnel function had to be dissolved and the
personnel manager's position became redundant. The worker's
salary in January, 1992 was #27,000 per annum and the Company
offered him a redundancy package effective from 31st March, 1992
of #50,000 lump sum including statutory entitlements plus a
pension of #7,950 per annum at age 65. The offer was rejected
by the worker. The Union claims that a real redundancy
situation does not exist and that the worker should be
re-instated. No agreement could be reached at local level
discussions and the matter was referred on 7th February, 1992 to
the Labour Relations Commission. A conciliation conference was
held on 4th March, 1992 at which no agreement could be reached.
The dispute was referred to the Labour Court on 27th March, 1992
in accordance with Section 26(1) of the Industrial Relations
Act, 1990. The Court investigated the dispute on 24th April,
1992. Subsequent to the hearing the Company submitted a copy of
the consultant's report to the Court on a confidential basis.
UNION'S ARGUMENTS:
3. 1. This is not a real redundancy situation. In December,
1991 the worker concerned was involved in an incident
(details supplied to the Court) with the operations
manager. Prior to that incident the worker had not
received any indication that his job was in danger.
Following the incident the worker was informed of the
decision to make his position redundant.
2. The Union does not accept that the position of
personnel manager is redundant. Other members of
management are effectively carrying out the personnel
functions in the absence of the worker. Even if the
position is redundant there is no reason why the worker
should not be offered an alternative position. The Company
should acknowledge that it has erred in the decision to
make the worker redundant and he should be re-instated.
3. The lump sum of #50,000 gross offered by the Company
is not in line with established local settlements.
Redundancy compensation in the area is established at 5
weeks per year of service plus statutory. Applying this
formula the lump sum would be #63,000.
COMPANY'S ARGUMENTS:
4. 1. Following a review of Company operations by a firm of
consultants the Company decided to introduce world class
manufacturing in order to become more competitive and
return to profitability. This involves a change in
management style which demands the diffusion of
responsibility for personnel matters down towards direct
management staff. The traditional role of personnel
manager therefore became redundant.
2. As defined by legislation, the position of personnel
manager has become redundant. The tasks previously carried
out by the personnel manager have been diffused downwards
and integrated into the role of the Company's line
managers. The Company does not have any other management
position which would be suitable for the worker concerned.
3. The Company regrets the personal impact of the
redundancy on the worker concerned. The redundancy package
offered to him is generous and takes account of his
contribution and length of service with the Company
RECOMMENDATION:
The Court has given careful consideration to all the points both
written and oral made by the parties in this dispute. The Court
also had sight of the special report prepared for the Company
which they submitted was the basis on which they decided to take
the action they did.
The claimant had a long and exemplary record in the Company
having worked his way up to the position of Personnel Manager.
Whilst noting the Company's arguments supporting their case for
declaring the claimant redundant under the provisions of the
Redundancy Payments Act as amended the Court nevertheless is
satisfied that he was treated unfairly and that with goodwill it
should have been possible to retain him in employment in the
Company at an appropriate level.
The Court accordingly recommends concession of the Union's claim
that the claimant be re-instated.
~
Signed on behalf of the Labour Court
Evelyn Owens
____________________
20th May, 1992
A.S./N.Ni.M. Deputy Chairman
NOTE:
Enquiries concerning this Recommendation should be addressed to
Mr. Alfie Smith, Court Secretary.