Labour Court Database __________________________________________________________________________________ File Number: CD95112 Case Number: LCR14693 Section / Act: S26(1) Parties: MC CARREN AND COMPANY LIMITED (THE IRISH BUSINESS AND EMPLOYERS CONFEDERATION) - and - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION |
Redundancy terms.
Recommendation:
The Court recommends that the severance payment be increased to 3.25
weeks' pay per year of service plus the statutory entitlements.
Division: Mr McGrath Mr Keogh Mr Walsh
Text of Document__________________________________________________________________
CD95112 RECOMMENDATION NO. LCR14693
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES:
MC CARREN AND COMPANY LIMITED
(REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS CONFEDERATION)
AND
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
SUBJECT:
1. Redundancy terms.
BACKGROUND:
2. The Company is a family owned independent pig processing
plant. It is located in Cavan and employs approximately 133
workers.
The case before the Court concerns the Company's proposal to
make one member of the clerical staff redundant. The
redundancy situation has arisen following the introduction of
new technology into the office area. The Company has
indicated that a second redundancy would follow later in the
year.
The Union's position is that it is prepared to accept one
voluntary redundancy on the basis that the existing
redundancy terms in the Company are improved, that
comprehensive cross training on all office functions is
provided and that the remaining staff share in the savings
arising from the reduction in staff.
The Union submitted a claim for 6 weeks' pay per year of
service plus statutory entitlements. The Company rejected
the claim. The matter was referred to the Labour Relations
Commission. A conciliation conference was held on 31st
January, 1995. As no agreement was reached the matter was
referred to the Labour Court on 8th February, 1995 under
Section 26(1) of the Industrial Relations Act, 1990. A
Labour Court hearing took place in Cavan on 14th February,
1995.
UNION'S ARGUMENTS:
3. 1. The Company is funding the installation of new
technology from savings arising from the reduction in
the number of clerical staff (#90,000 per annum). The
workers have not shared in the savings.
2. The clerical staff is the only grade in the Company that
has been affected by redundancies. If the Company's
proposal to reduce the number from ten down to eight is
put into effect, the numbers will have reduced by fifty
per cent since 1989.
3. The cross training originally proposed by the Company 6
years ago must now become a reality. It must involve
training on all aspects of computer working (including
the work performed by a member of management) which is
proper to the clerical workers. The workers must be
given every opportunity to protect their long term
future in the Company.
4. The Company's proposal to reduce the number of clerical
staff from ten down to eight is not practical, even
allowing for the impact of new technology.
5. It is accepted in industry generally that savings
accruing from rationalisation plans are divided on the
basis of one-third to the Company, one-third to the
workers and one-third to new technology.
6. Compensation claims locally are averaging 5 weeks' pay
per year of service plus statutory. In the
circumstances the Union's claim for 6 weeks' pay per
year of service plus statutory is reasonable.
COMPANY'S ARGUMENTS:
4. 1. It is regrettable, due to the introduction of new
technology and the resulting change in the nature of the
job, that the Company has a requirement for one
redundancy at present. It should also be noted that
there will be a further requirement for another
redundancy in the middle of 1995.
2. The Company's financial position does not allow it to
pay a redundancy package in excess of its established
precedent of three and a quarter weeks pay per year of
service inclusive of statutory entitlements. It also
does not allow the Company to divide any "savings"
amongst the remaining employees. Faced with losses of
#400,000 for this financial year, the Company has a
responsibility to achieve savings wherever it can to
maintain its competitiveness and efficiency.
RECOMMENDATION:
The Court recommends that the severance payment be increased to 3.25
weeks' pay per year of service plus the statutory entitlements.
~
Signed on behalf of the Labour Court
1st March, 1995 Tom McGrath
F.B./D.T. _______________
Deputy Chairman
Note
Enquiries concerning this Recommendation should be addressed to
Mr. Fran Brennan, Court Secretary.