Labour Court Database __________________________________________________________________________________ File Number: CD9370 Case Number: LCR13990 Section / Act: S26(1) Parties: SECURICOR (IRELAND) LIMITED - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Severance Terms.
Recommendation:
5. The Court having considered the views expressed by the parties
in their oral and written submissions and given all the
circumstances of this case recommends that the workers concerned
be paid severance terms of 3 weeks per year of service plus
statutory entitlements with pro-rata payments in respect of
part-time staff.
The Court so recommends.
Division: MrMcGrath Mr Keogh Mr O'Murchu
Text of Document__________________________________________________________________
CD9370 RECOMMENDATION NO. LCR13990
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: SECURICOR (IRELAND) LIMITED
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Severance Terms.
BACKGROUND:
2. The Company employs approximately 825 people at its various
locations in Ireland. It has two main operating divisions known
respectively as the Security Division and the Parcels Division.
In April, 1992, the Union was advised by management of the
possibility of redundancies in the Parcels Division as a result of
changes in customs regulations which would come into effect on
1st January, 1993. In October, 1992, the Company confirmed that
two workers would be made redundant with effect from 17th January,
1993. Due to staff changes which recently took place in this area
no definite decision has been taken on the proposed redundancies.
In August, 1992 it was announced to all staff in the Security
Division that there was a need to invest in the Company and to
reduce costs to enable the Company to compete more effectively in
the market place. It was stated that the financial performance of
the division was unsatisfactory and that steps had to be taken to
secure the future of the Company. To address this situation the
Company proposed:
"(A) to invest substantially over a period of up to two years
in systems requiring both hardware and software and
(B) to reduce or eliminate unnecessary costs".
The Union was advised that these proposals would involve some
staff redundancies in administrative positions based in Dublin.
In October, 1992 management confirmed that it was seeking five
redundancies.
Local level discussion took place on the proposed redundancies at
which the Company made an offer of 3 weeks' pay per year of
service inclusive of statutory entitlements. The Union, which was
seeking 6 weeks' pay per year of service, rejected the offer and
the matter was referred to the Labour Relations Commission. A
conciliation conference took place on 18th December, 1992 but no
agreement could be reached and the matter was referred to the
Labour Court on 28th January, 1993. The Court hearing took place
on 18th February, 1993.
UNION'S ARGUMENTS:
3. 1. The redundancies are taking place not because they are
necessary but because the savings generated will be used by
management to fund the #1 million investment.
2. The workers concerned are investing their jobs in the
Company's new computerised systems.
3. This is not a "survival" or "rescue" operation.
4. The level of severance pay on offer is totally inadequate.
5. The severance terms proposed by management compare
unfavourably with redundancy packages in other employment.
6. In the circumstances where the Company has invested #1
million in computerisation, the Union's claim for 6 weeks' pay
per year of service is not unreasonable.
COMPANY'S ARGUMENTS:
4. 1. The current redundancy formula has been agreed with the
Union and implemented by the Company since 1984.
2. The Company must improve its financial performance and is
not in a position to increase the existing redundancy formula.
3. In the year ending September, 1992 the Company made a
loss.
4. Security services personnel are mainly employed on jobs
dependent on written contracts. As a result redundancies are
inevitable from time to time. Any changes in the agreed
redundancy formula will adversely affect the Company's
competitive position.
5. It is crucial that in order to improve the Company's
competitive position and thus preserve jobs the Company is not
put in a position of increasing its costs.
6. The severance terms on offer compare favourably with those
of other companies in the security industry. Some companies
only pay statutory redundancy entitlements.
RECOMMENDATION:
5. The Court having considered the views expressed by the parties
in their oral and written submissions and given all the
circumstances of this case recommends that the workers concerned
be paid severance terms of 3 weeks per year of service plus
statutory entitlements with pro-rata payments in respect of
part-time staff.
The Court so recommends.
~
Signed on behalf of the Labour Court
Tom McGrath
___________________
15th March, 1993 Deputy Chairman.
F.B./J.C.
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Fran Brennan, Court Secretary.