Labour Court Database __________________________________________________________________________________ File Number: CD95501 Case Number: LCR15044 Section / Act: S26(1) Parties: IRISH DISTILLERS LIMITED (Represented by THE IRISH BUSINESS AND EMPLOYERS CONFEDERATION) - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Restoration of meal allowance.
Recommendation:
It would appear that the employees accept the requirement to have
the meal allowance taxed but do not accept the Company proposal to
discontinue the payment altogether.
The Company argument for discontinuing this payment seems to be
based on administrative inconvenience.
The Court, having considered all the information before it,
recommends as follows:-
(1) The employees to be paid for the period since the allowance
was discontinued to date of this Recommendation. This
payment to be taxed.
(2) Employees should now be given a final opportunity to accept
the Company proposal on a lump sum. If they reject this
proposal then this allowance should be red-circled to these
employees and paid but taxed.
Division: Mr Flood Mr Keogh Mr Rorke
Text of Document__________________________________________________________________
CD95501 RECOMMENDATION NO. LCR15044
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES:
IRISH DISTILLERS LIMITED
(REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS CONFEDERATION)
AND
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
Restoration of meal allowance.
BACKGROUND:
The dispute concerns the discontinuance of a £5 tax-free meal
allowance to two depot-based workers in Galway.
In 1994, an Income Tax Inspector informed the Company that
the tax-free allowance was in breach of PAYE regulations.
The Company made the two workers aware that it would
discontinue the allowance, but they continued to receive it
until 9th June, 1995. The Company proposed a buy-out of the
allowance of two taxable amounts of £2,500 each - one in 1995
and one in 1996. It also offered the facility of having the
money invested in additional voluntary contributions (AVCs)
or in Company share purchase.
The Union was not agreeable to the Company's proposals and
proposed the following alternative:
1. Payment of meal allowance from 9th June until the date
of agreement on the recommendation (NETT).
2. That the £5,000 compensation should be paid, NETT, with
the Company making good the income tax liability on
same.
Following discussions at local level, the dispute was
referred to the Labour Relations Commission. A conciliation
conference took place on 9th August, 1995, but no agreement
was reached. The dispute was then referred to the Labour
Court on 30th August, 1995, in accordance with Section 26(1)
of the Industrial Relations Act, 1990. A Labour Court
hearing took place in Galway on 30th November, 1995.
UNION'S ARGUMENTS:
1. Galway is the only centre in the group of Irish Distillers
Limited companies which does not have a canteen that provides
cooked meals at a subsidised rate. The workers would not
benefit greatly from the AVCs or the Company's share
purchase. The £5,000 in two separate payments would be
subject to tax, thereby reducing the value substantially.
The Company's handling of the dispute is not in keeping with
Company/Union Agreement.
COMPANY'S ARGUMENTS:
1. The Company agreed to continue paying the allowance tax free
from 1st January to 9th June, 1995. This was worth
considerable money to the two workers. The offer of £5,000
compensation is very generous. The Company is willing to
make the offer as tax effective as possible by utilising AVCs
or Company share purchase. The Company had no choice but to
discontinue the payment as it was contrary to PAYE
regulations.
RECOMMENDATION:
It would appear that the employees accept the requirement to have
the meal allowance taxed but do not accept the Company proposal to
discontinue the payment altogether.
The Company argument for discontinuing this payment seems to be
based on administrative inconvenience.
The Court, having considered all the information before it,
recommends as follows:-
(1) The employees to be paid for the period since the allowance
was discontinued to date of this Recommendation. This
payment to be taxed.
(2) Employees should now be given a final opportunity to accept
the Company proposal on a lump sum. If they reject this
proposal then this allowance should be red-circled to these
employees and paid but taxed.
~
Signed on behalf of the Labour Court
21st December, 1995 Finbarr Flood
C.O.N./A.K. _______________
Deputy Chairman
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Ciaran O'Neill, Court Secretary.