LCR14470

Subject:
Restructuring/Compulsory Redundancies.

Recommendation:
The Court has given careful consideration to all the points made
by the parties in both their written submissions and during the
hearing. The Court has also studied the financial information
submitted on a confidential basis to the Court. The Court is
satisfied that there is need for the parties to engage in direct
meaningful negotiations on the terms which are offered by the
Company for the implementation of redundancies. In this regard
the Court notes that the Company accepts that the employees whom
it wishes to make redundant may have individual circumstances
which need to be addressed and that they are willing to discuss
these with the Union. A satisfactory outcome of such discussions
might eliminate the need for compulsory redundancy.

In view of the urgency of the matter the Court recommends that the
parties address the terms of the redundancy package immediately.
The Court envisages these negotiations reaching conclusion in one
month from the date of issue of this recommendation. In the
interest of creating a climate conducive to amicable negotiations
the Court further recommends that the Company agree to the
postponement of the redundancy notices issued.




In the event of the parties failing to agree they may refer back
directly to the Court who will then make a recommendation on the
issues still in dispute at that time.

CLARIFICATION:







12th July, 1994.



Mr. Tony McMahon,
Industrial Relations Officer,
Irish Bank Officials' Association,
93, St. Stephens Green,
Dublin 2.



Dear Tony,

RE: LABOUR COURT RECOMMENDATION 14470

(IBOA - MSF AND WOODCHESTER CREDIT LYONNAIS BANK)


In issuing its recommendation the Court clearly stated that it saw
an urgent need for the parties to engage in direct discussions on
the redundancy package on offer. It also clearly understood from
statements at the hearing that employees listed for redundancy may
have individual problems which should be addressed in the course
of these negotiations. No parameters were suggested by the Court
as to how these problems should be dealt with.

The Courts objective and expectation was that the outcome of the
negotiations which included addressing the individual problems
referred to would eliminate the need for compulsory redundancy.

The question of extending any revised terms to employees already
left the employment is conceded by the Bank.

The question of inviting further redundancy applications on the
new terms was not addressed specifically by the Court and whilst
not part of the Recommendation, the Court does not rule out the
parties discussing this as part of the above.



With regards to the postponement of redundancy notices issued this
clearly applies to those issued and not expired.

The Court would urge the parties to complete their negotiations
without further delay.


Yours sincerely



________________
Evelyn Owens
Deputy Chairman.



Division: Ms Owens Mr Keogh Mr Rorke

Text of Document__________________________________________________________________


CD94295 RECOMMENDATION NO. LCR14470

INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990

PARTIES:
WOODCHESTER CREDIT LYONNAIS BANK LIMITED

AND

IRISH BANK OFFICIALS' ASSOCIATION
MANUFACTURING SCIENCE FINANCE


SUBJECT:

1. Restructuring/Compulsory Redundancies.


BACKGROUND:

2. Woodchester Credit Lyonnais Bank Limited is the main Irish
subsidiary of Woodchester Investments. The Bank is
structured into three divisions, lease and instalment
finance, corporate banking and treasury. The lease and
instalment finance division employs approximately 90% of the
Bank's employees. Its head office is in Dublin and it has

twelve branch offices throughout the country.

In early 1994, following a review of its costs, the Bank
decided on a restructuring plan involving the closure of its
Carlow branch and the centralisation of its collections
function. The restructuring plan involved 76 redundancies,
48 of which were achieved by voluntary means. The contracts
of temporary staff have been terminated. This left the
redundancy of 20 positions still to be achieved of which 10
have already left the bank.

The Unions rejected the Company proposals and sought the
deferment of the plan to allow for adequate discussions on
all aspects of the restructuring plan. Local level
discussions took place but no agreement was reached and the




dispute was referred to the Labour Relations Commission. A
conciliation conference was held on 23rd May, 1994. As no
agreement could be reached the dispute was referred to the
Labour Court on 23rd May, 1994, in accordance with Section
26(1) of the Industrial Relations Act, 1990. A Labour Court
hearing took place on 3rd June, 1994. A recommendation was
issued by letter on 14th June, 1994.


UNIONS' ARGUMENTS:

3. 1. There is no justification for the Bank's actions
regarding compulsory redundancies. Compulsory
redundancies normally arise in situations where a
company is in danger of closure unless costs are
immediately reduced.

2. No meaningful discussions took place regarding the
restructuring plan. This approach blatantly ignores a
reassurance given to all staff in February, 1994,
(details supplied to the Court), and is contrary to the
Programme for Economic and Social Progress (P.E.S.P.).

3. The fundamental issue involved is the question of
compulsory redundancies. Despite statements to the
contrary, it is the clear disposition of the Bank
to effect redundancies compulsorily. This disposition
has been characterised by:-

(a) refusal to negotiate on voluntary parting terms,

(b) refusal to extend the deadline for application
for voluntary redundancy,

(c) refusal to examine in detail options to avoid
redundancy,

(d) a fixed and limited timescale within which to
achieve a target number of staff reductions,

(e) use of threat of compulsory redundancies to force
individuals to take transfers/alternative positions
in the Company.




4. The Bank is an extremely profitable organisation which
made profits of approximately #32 million in 1993. In
the circumstances compulsory redundancies are
unacceptable and all notices of compulsory redundancies
should be withdrawn and the Company should engage in
discussions with the Trade Unions on the issues
involved.


BANK'S ARGUMENTS:

4. 1. All practical steps have been taken to avoid compulsory
redundancy. The overall level of redundancies required
has been kept to a minimum with substantially increased
targets being set for business development, thus
increasing the volume of business to be processed by the
Bank.

2. Compulsory redundancies have been sought only where no
realistic alternative exists. For commercial reasons it
was decided to close the Carlow Branch. In this
situation compulsory redundancies could not be avoided.
To suggest that the Bank should not declare redundancies
in cases such as Carlow would be unacceptable and
impractical.

3. Compulsory redundancy of Trade Union members within the
Branch Network are required solely as a result of the
decision to centralise the collections function. This
decision has been brought about by the need to reduce
overheads. As the collections process is centralised
the collections jobs in the branches disappear. The
geographical spread of the Branch Network prevents
redeployment in virtually all cases.

4. By accepting voluntary redundancy applications from
areas of the business where redundancies are not sought
and by encouraging staff to apply for these vacancies
the Bank has minimised the adverse impact of the
rationalisation programme.

5. If the Bank does not implement the redundancies
identified, the business will continue to operate at an
unacceptable level of profitability - an issue which
would inevitably have to be addressed at a later stage.





6. The cost reduction programme is critical to the future
success of the business and the security of employment
of the employees. The leasing sector has experienced
serious trading difficulties and in one particular case
a receiver has been appointed. These difficulties
emphasise the need for Woodchester to operate in a cost
effective manner which is not currently the position.


RECOMMENDATION:
The Court has given careful consideration to all the points made
by the parties in both their written submissions and during the
hearing. The Court has also studied the financial information
submitted on a confidential basis to the Court. The Court is
satisfied that there is need for the parties to engage in direct
meaningful negotiations on the terms which are offered by the
Company for the implementation of redundancies. In this regard
the Court notes that the Company accepts that the employees whom
it wishes to make redundant may have individual circumstances
which need to be addressed and that they are willing to discuss
these with the Union. A satisfactory outcome of such discussions
might eliminate the need for compulsory redundancy.

In view of the urgency of the matter the Court recommends that the
parties address the terms of the redundancy package immediately.
The Court envisages these negotiations reaching conclusion in one
month from the date of issue of this recommendation. In the
interest of creating a climate conducive to amicable negotiations
the Court further recommends that the Company agree to the
postponement of the redundancy notices issued.




In the event of the parties failing to agree they may refer back
directly to the Court who will then make a recommendation on the
issues still in dispute at that time.

~
Signed on behalf of the Labour Court


30th August, 1994 Evelyn Owens
F.B./M.M. ____________
Chairman

Note

Enquiries concerning this Recommendation should be addressed to
Mr. Fran Brennan, Court Secretary.




CLARIFICATION:







12th July, 1994.



Mr. Tony McMahon,
Industrial Relations Officer,
Irish Bank Officials' Association,
93, St. Stephens Green,
Dublin 2.



Dear Tony,

RE: LABOUR COURT RECOMMENDATION 14470

(IBOA - MSF AND WOODCHESTER CREDIT LYONNAIS BANK)


In issuing its recommendation the Court clearly stated that it saw
an urgent need for the parties to engage in direct discussions on
the redundancy package on offer. It also clearly understood from
statements at the hearing that employees listed for redundancy may
have individual problems which should be addressed in the course
of these negotiations. No parameters were suggested by the Court
as to how these problems should be dealt with.

The Courts objective and expectation was that the outcome of the
negotiations which included addressing the individual problems
referred to would eliminate the need for compulsory redundancy.

The question of extending any revised terms to employees already
left the employment is conceded by the Bank.

The question of inviting further redundancy applications on the
new terms was not addressed specifically by the Court and whilst
not part of the Recommendation, the Court does not rule out the
parties discussing this as part of the above.



With regards to the postponement of redundancy notices issued this
clearly applies to those issued and not expired.

The Court would urge the parties to complete their negotiations
without further delay.


Yours sincerely



________________
Evelyn Owens
Deputy Chairman.