Labour Court Database __________________________________________________________________________________ File Number: CD93275 Case Number: LCR14073 Section / Act: S26(1) Parties: GARN TEO - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Dispute concerning redundancy lump sum payments.
Recommendation:
7. The Court, in the light of the submissions of the parties,
oral and written, recommends that the severance pay be increased
to an amount of #30,000 to be distributed in accordance with the
service of the employees.
The Court so recommends.
Division: MrMcGrath Mr Keogh Mr Walsh
Text of Document__________________________________________________________________
CD93275 RECOMMENDATION NO. LCR14073
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES: GARN TEO
(REPRESENTED BY THE IRISH BUSINESS EMPLOYERS' CONFEDERATION)
and
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Dispute concerning redundancy lump sum payments.
BACKGROUND:
2. The Company is located in Ardara, County Donegal where, since
its foundation in 1979, it has been engaged in the manufacture of
spun yarn. The Company employed a total of 17 workers.
3. In February, 1993 the Company announced its closure due to its
failure to secure orders, the effects of the currency crisis and
competition in the market place from lower cost producers. The
Company issued its staff with notice of redundancy on 26th
February, 1993 to take effect on 9th April, 1993. The closing
date was extended until 7th May, 1993 so that residual orders
could be dealt with.
4. Following the announcement of the closure the Union lodged a
claim, on behalf of the workers, for the payment of redundancy
lump sums calculated on the basis of 6 weeks' pay per year of
service. The Company rejected the claim and stated that it was
not in a position to pay anything in excess of statutory
entitlements. The dispute was referred to the Labour Relations
Commission. A conciliation conference was held on 31st March,
1993 at which the Industrial Relations Officer put forward a
proposal for the payment of two weeks' pay per year of service,
inclusive of statutory entitlements. This proposal was accepted
by the Union but rejected by the Company. As no agreement was
reached the Commission, with the consent of the parties, referred
the dispute to the Labour Court on 27th April, 1993 for
investigation and recommendation under Section 26(1) of the
Industrial Relations Act, 1990. A Labour Court hearing took place
on 7th May, 1993. The Court issued its recommendation, by letter,
on the same day.
UNION'S ARGUMENTS:
5. 1. The workers, despite the uncertainty of their future,
co-operated fully with the orderly closure of the factory.
2. The workforce has contributed immensely and co-operated
fully with the Company during its existence.
3. The workforce has very little hope of securing alternative
employment.
COMPANY'S ARGUMENTS:
6. 1. The Company's closure is brought about by the collapse of
the market for its product.
2. The Company has been in a loss making position since 1987
and is not in a position to pay, from its own resources,
anything in excess of statutory entitlements (details supplied
to the Court).
RECOMMENDATION:
7. The Court, in the light of the submissions of the parties,
oral and written, recommends that the severance pay be increased
to an amount of #30,000 to be distributed in accordance with the
service of the employees.
The Court so recommends.
~
Signed on behalf of the Labour Court
Tom McGrath
____________________
25th May, 1993. Deputy Chairman
M.D./J.C.
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Michael Daughen, Court Secretary.