FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : AVERY BERKEL (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - TECHNICAL, ENGINEERING AND ELECTRICAL UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr McHenry Worker Member: Ms Ni Mhurchu |
1. Redundancy Calculation.
BACKGROUND:
2. The Company was established in 1993, following the merger of GEC Avery and Berkel Ireland. It is involved in the supply and service of weighing machines and currently employs 55 workers. In June, 1997, as part of a global rationalisation plan, the Company made 4 workers redundant. The dispute concerns a claim, on behalf of one of the 4 workers, for the inclusion of benefit-in-kind, in respect of a company car, in the calculation of his redundancy package. The redundancy package he received amounted to £24,671 based on 3.5 weeks' pay per year of service, plus statutory.
The Company rejected the Union's claim for the inclusion of benefit-in-kind in redundancy calculations, adding that it had not been included in previous redundancy packages.
The dispute was the subject of a conciliation conference under the auspices of the Labour Relations Commission, at which agreement was not reached. The dispute was referred to the Labour Court, on the 12th of June, 1998, in accordance with Section 26 (1) of the Industrial Relations Act, 1990. The Court carried out its investigation on the 20th of October, 1998.
UNION'S ARGUMENTS:
1. The Company's severance package was arrived at arbitrarily with no input from the employees or their representatives. In the context of the worker's forced redundancy, the level of compensation should be greater than conceded by the Company.
2. In response to the claim for inclusion of benefit-in-kind, the Company adhered to the £300.00 ceiling applying to statutory entitlements. This ceiling was not applied to the calculation of the Company lump sum and should not be applied in respect of benefit-in-kind.
COMPANY'S ARGUMENTS:
1. The redundancy package applied to the worker was the standard Company package which applied during previous redundancies, when benefit-in-kind was not included in redundancy calculations.
2. Given that the non-statutory redundancy payment is ex-gratia, what is included in it is a matter for the Company. Because of the cut-off on earnings for statutory entitlements of £300.00, the issue of benefit-in-kind never arises.
RECOMMENDATION:
The Court, having heard the submissions on the issue of the inclusion of the benefit-in-kind of a company car in the ex-gratia calculation of a redundancy payment, does not recommend concession of the Union's claim.
Signed on behalf of the Labour Court
Caroline Jenkinson
20th November, 1998______________________
MK/BCDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Michael Keegan, Court Secretary.