Labour Court Database __________________________________________________________________________________ File Number: CD93415 Case Number: LCR14295 Section / Act: S26(1) Parties: QUIGLEY COMPANY OF EUROPE - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Dispute concerning Redundancy Terms.
Recommendation:
The Court, having considered all of the views of the parties, as
expressed in their oral and written submissions, while recognising
the arrangements which applied in previous redundancy situations,
is of the view that the parties must consider redundancy
arrangements which are relevant to the current situation which
applies in the Company. Taking account of all the circumstances
put forward and the information supplied, the Court considers that
the Company proposals are reasonable and should be accepted.
The Court so recommends.
Division: MrMcGrath Mr Brennan Mr Walsh
Text of Document__________________________________________________________________
CD93415 RECOMMENDATION NO. LCR14295
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: QUIGLEY COMPANY OF EUROPE
now MINTEQ EUROPE LIMITED
(REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
AND
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Dispute concerning Redundancy Terms.
BACKGROUND:
2. The Company is based in the Tivoli Industrial Estate, Cork
and is involved in the manufacture of refractory products for the
steel industry. In November, 1992, the Company indicated that,
due to the ongoing recession, it was obliged to make 24 workers
redundant. The Company offered a redundancy package of 2.5 weeks'
pay per year of service with a cap of 25 years' service. The
package was rejected by the Union, which sought redundancy terms
in line with Labour Court Recommendation No LCR 11181,
appropriately adjusted for 1993. In 1987, the workers were paid
#1,200 per year of service. The Company was not in a position to
increase its offer and the dispute was referred to the Labour
Relations Commission and a conciliation conference was held on the
19th of January, 1993, at which agreement was not reached. The
dispute was referred to the Labour Court, on the 12th of July,
1993, in accordance with section 26(1) of the Industrial Relations
Act, 1990. The Court investigated the dispute, in Cork, on the
27th of October, 1993.
UNION'S ARGUMENTS:
3. 1. In 1987, in LCR 11181, the Labour Court recommended that
an amount of #1,200 per year of service be paid to workers
made redundant. This amount has been updated in all
subsequent redundancy agreements and should now stand at
#1,420 per year of service.
2. The Company's offer of between #850 and #1,000 per year
of service falls short, on average, by #470 per year of
service. For workers with 20 years' service, the shortfall
amounts to #9,400 and for workers with 29 years' service, the
shortfall amounts to #15,080.
3. LCR 11181 did not recommend a ceiling on redundancy
payments. The Company is now trying to impose such a
ceiling.
4. The trading position of this Company has improved
dramatically in recent times; short-time working has ceased
and overtime work is available for the first time in years.
5. Many of the workers who have been made redundant will
never work again, due to the current economic situation, and
their only cushion against severe hardship will be a proper
redundancy settlement.
COMPANY'S ARGUMENTS:
4. 1. The manufacturing plant continues to face severe
economic and competitive pressure. The first priority must
be the survival of the plant and protection of the remaining
jobs. In these circumstances, it is unrealistic of the Union
to expect the implementation of the terms of previous
severance packages. The settlement terms offered in any
redundancy situation have to reflect the position the Company
finds itself in at that particular time, if the Company is to
survive.
2. Of the workers made redundant, 11 volunteered on the
basis of the severance package offered by the Company. In
the main, these were employees with more than 25 years'
service. The fact that a 25-year cap was in place did not
seem to deter these employees.
3. In previous redundancy settlements, a lump sum per year
of service (including statutory) was offered to the
employees. Allowing for the exemptions granted by the
Revenue Commissioners and after the deduction of statutory
entitlements from the lump sum, the residue was subject to
tax as normal earnings.
4. Regarding the current redundancy situation, the Company
submitted details of three years' earnings to the Revenue
Commissioners in order to gain Standard Capital
Superannuation Benefits (S.C.S.B.) exemptions. In all cases,
the S.C.S.B. exemptions were granted which meant that the tax
burden on the individual was minimal. The Company would make
the point that the nett figure, which the employee takes
home, is the important figure, not the gross figure, from
which it was derived.
5. The Company has managed the monies allocated to the
redundancy package by the Company's New York office, to the
best advantage of the workers being made redundant.
RECOMMENDATION:
The Court, having considered all of the views of the parties, as
expressed in their oral and written submissions, while recognising
the arrangements which applied in previous redundancy situations,
is of the view that the parties must consider redundancy
arrangements which are relevant to the current situation which
applies in the Company. Taking account of all the circumstances
put forward and the information supplied, the Court considers that
the Company proposals are reasonable and should be accepted.
The Court so recommends.
~
Signed on behalf of the Labour Court
17th December, 1993. Tom McGrath
M.K./A.L. _______________
Deputy Chairman
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Michael Keegan, Court Secretary.