FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 20(1), INDUSTRIAL RELATIONS ACT, 1969 PARTIES : DUBLIN DRUG COMPANY LIMITED (REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - MANUFACTURING, SCIENCE, FINANCE DIVISION : Chairman: Mr Flood Employer Member: Mr McHenry Worker Member: Mr O'Neill |
1. Dispute regarding the takeover of Dublin Drug by United Drug plc.
BACKGROUND:
2. In June, 1997, United Drug made a formal unsolicited offer to take over Dublin Drug. In October, 1997, the required 80% majority of shareholders accepted the offer, the Department of Enterprise, Trade and Employment granted regulatory clearance in November, 1997, and shares were issued on the 2nd of December, 1997. Dublin Drug was then legally a subsidiary of United Drug.
The Union claims that the Company is in breach of the EU Safeguarding of Employees' Rights on Transfer of Undertakings Regulations, 1980, as it did not consult with the Union prior to the transfer. It also requests the Labour Court to instruct the Company to enter into negotiations on a number of related issues. The Company contends that employees were kept informed of developments from July, 1997, and that discussions on issues relevant to the take-over would commence in 1998. The Company states that it is negotiating with the Union. The Union referred the issue to the Labour Court on the 3rd of December, 1997, in accordance with Section 20(1) of the Industrial Relations Act, 1969, and agreed to be bound by the Court's recommendation. The Court investigated the dispute on the 5th of February, 1998, the earliest date suitable to the parties.
UNION'S ARGUMENTS:
3. 1. The Company is in breach of the EU Safeguarding of Employees' Rights on Transfer of Undertakings Regulations, 1980, as it refused to meet with the Union in good time to discuss the reasons for the transfer, the legal, economic and social implications for the employees and the measures envisaged in relation to the employees.
2. The Company neglected to inform the Union of the proposed takeover at a meeting in September, 1997. Since October, 1997, it has refused to meet with the Union and to disclose the names of management in United Drug. The Company now proposes to conduct all negotiations on a joint basis between MSF and SIPTU although it has not consulted MSF on this issue.
COMPANY'S ARGUMENTS:
4. 1. The Company is committed to negotiations with the Trade Union and is aware of its obligations under the Transfer of Undertakings Regulations. There was no attempt to disregard employees who have been kept informed of the likely changes which may take place in the future with their agreement.
2. Prior to the 2nd of December, 1997, United Drug was a competitor to Dublin Drug. If 80% of the shareholders had not accepted the offer, if the Minister for Enterprise, Trade and Employment had not cleared the takeover or if the Competition Authority had refused permission to proceed the takeover would have been cancelled. It would, therefore, have been unwise and impractical to commence negotiations with unions or to involve United Drug until the transfer was completed.
RECOMMENDATION:
The Court is not satisfied that evidence has been produced to substantiate the Union claim that the Company is in breach of the legislation on Safeguarding of Employee Rights on Transfer of Undertakings Regulations.
The Court would recommend that the Union accept the Company invitation as in the letter of 29th January to discuss the issues arising from the takeover of Dublin Drug by United Drug.
Signed on behalf of the Labour Court
Finbarr Flood
12th February, 1998______________________
D.G./S.G.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Dympna Greene, Court Secretary.