Labour Court Database __________________________________________________________________________________ File Number: CD95262 Case Number: LCR14813 Section / Act: S20(1) Parties: GEC AVERY BERKEL LIMITED (THE IRISH BUSINESS AND EMPLOYERS CONFEDERATION) - and - A WORKER;MANUFACTURING SCIENCE FINANCE |
Redundancy payment and pension entitlements.
Recommendation:
Having considered the submissions from the parties and noting that
the claimant was made compulsorily redundant and that there was no
agreement with the Union as to the terms of such redundancy the
Court recommends that the abatement of redundancy payment should
be restored. The claimant should accordingly be paid redundancy
at 3.50 weeks per year of service plus statutory and pay in lieu of
notice.
This recommendation is not intended to set any precedent as to
what might be agreed between the parties in the event of any
future similar compulsory redundancy.
Insofar as the pension element of the claim is concerned the Court
is of the opinion that it is a matter which should be resolved
between the parties, having regard to the rules of the scheme.
Accordingly, the Court is not issuing any recommendation on this
matter.
Division: Ms Owens Mr Pierce Mr Walsh
Text of Document__________________________________________________________________
CD95262 RECOMMENDATION NO. LCR14813
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 20(1), INDUSTRIAL RELATIONS ACT, 1969
PARTIES:
GEC AVERY BERKEL LIMITED
(REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS CONFEDERATION)
AND
A WORKER
(REPRESENTED BY MANUFACTURING SCIENCE FINANCE)
SUBJECT:
1. Redundancy payment and pension entitlements.
BACKGROUND:
2. 1. The Company employs approximately sixty two workers at
its premises in the Western Industrial Estate,
Clondalkin, Co. Dublin. It is engaged in the sale,
distribution and maintenance of weighing machines and
food processing equipment. The Company was formed by
the amalgamation in 1993 of the Avery and Berkel
operations at both international and local level.
2. A voluntary redundancy programme was set up following
the 1993 merger and fourteen employees availed
themselves of this. The terms of the programme were
negotiated with the Union. A further re-organisation of
the Company took place in 1995 following two years of
trading difficulties. This resulted in the closure of
the pump maintenance division and a further seven
redundancies. The Company applied the terms of the 1993
Redundancy Programme to these redundancies. The Union
is claiming that one worker did not receive his proper
entitlements in relation to pension and redundancy
payments.
3. The Company objected to a Rights Commissioner
investigation of the dispute. The Union then referred
the dispute to the Labour Court under Section 20(1) of
the Industrial Relations Act, 1969. The Union agreed to
be bound by the decision of the Court. The Court
investigated the dispute on 22nd June, 1995.
UNION'S ARGUMENTS:
3. 1. The worker commenced employment with the Company in
September, 1956 and was compulsorily retired by the
Company in February, 1995. He had an exemplary record
while employed with the Company. In his thirty-nine
years' service with the Company he had only three days'
sick leave and was never late for work.
2. The worker refutes the Company's allegations that he was
engaged totally on mechanical work. He had been
involved in electronic work for a number of years. The
worker does not accept the argument that he was too old
to be re-trained.
3. The Company informed the worker that he would be paid 1
3/4 weeks' pay per year of service plus statutory
redundancy which the Company claimed was agreed with the
Union. The Union rejects this claim. What was agreed
was a voluntary package, based on 3.50 weeks' pay per year
of service, with a reduction of 50% applying to
employees over the age of sixty. There is no agreement
with the Company regarding compulsory redundancies. The
Company is therefore reducing the worker's entitlements
by 50% without agreement with the Union. The abatement
of his redundancy payment is not justified.
4. The Company is also reducing the worker's pension
entitlements by approximately 20%. Because the Company
has forced the worker to retire 4.50 years before he was
due to retire, will result in a reduced pension for the
worker. This is not justified given the exemplary
service the worker has given the Company.
COMPANY'S ARGUMENTS:
4. 1. The worker was selected for redundancy on a skills
basis. The worker had mainly worked on mechanical
operations which were in decline for the past fifteen
years. He is not skilled in the computerised electronic
equipment which is now dominant in the industry.
2. The worker accepted the redundancy package offered by
the Company and received a total of #36,214. The
formula for calculating the redundancy terms was based
on 1 3/4 weeks' pay per year of service plus statutory
redundancy, plus pay in lieu of notice. This formula
was agreed with the Union in 1993, when the worker
participated in discussions with the Company as a senior
shop steward of the Union.
3. The Company is satisfied that it has treated the worker
in a fair and reasonable manner. The severance package
has yielded the worker a substantial amount of money
which the Company considers generous. He has also
received full pension entitlements under the terms of
the pension scheme.
RECOMMENDATION:
Having considered the submissions from the parties and noting that
the claimant was made compulsorily redundant and that there was no
agreement with the Union as to the terms of such redundancy the
Court recommends that the abatement of redundancy payment should
be restored. The claimant should accordingly be paid redundancy
at 3.50 weeks per year of service plus statutory and pay in lieu of
notice.
This recommendation is not intended to set any precedent as to
what might be agreed between the parties in the event of any
future similar compulsory redundancy.
Insofar as the pension element of the claim is concerned the Court
is of the opinion that it is a matter which should be resolved
between the parties, having regard to the rules of the scheme.
Accordingly, the Court is not issuing any recommendation on this
matter.
~
Signed on behalf of the Labour Court
29th June, 1995 Evelyn Owens
L.W./D.T. ____________
Chairman
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Larry Wisely, Court Secretary.