FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : SMITH MC LAURIN LIMITED - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr Keogh Worker Member: Mr Rorke |
1. Dispute concerning the redundancy terms applying to two workers.
BACKGROUND:
2. The Company, which manufactured adhesive backing labels, has decided to cease operations in Portlaoise and in future will service its Irish customer base from the parent plant in Scotland. Prior to the closure announcement, the number of hourly paid workers had been reduced to two, the other employees had accepted a voluntary severance package in a major redundancy programme in 1997. The dispute relates to the redundancy package now being offered by the Company to the two workers. The 1997 redundancy package which the Union claims on behalf of the two workers comprised of the following elements:-
- 4 weeks' pay and a sum of £50 per year of service inclusive of
- No cap on the payment amount.
Group outplacement to be organised by the Company.
Normal week's pay to be the higher figure of
- the redundancy payment average formula.
The dispute was referred to the Labour Relations Commission. A conciliation conference was held on the 1st of July, 1999. Agreement was not reached. The dispute was referred to the Labour Court by the Labour Relations Commission on the 2nd of July, 1999. A Labour Court hearing was held on the 10th of August, 1999. A letter recommendation was issued on the 12th of August, 1999.
WORKER'S ARGUMENTS:
3. 1. The workers concerned have given loyal and dedicated service to the Company and this should be rewarded by giving them the same redundancy package as that given to former colleagues in 1997.
2. The Company can well afford to meet the cost of these redundancies. In the past it provided a much larger sum to the redundancy fund than what is now being asked of it. Since that time it has profitted from the sale of land and still has the plant (it fully owns a prime location) to sell along with the equipment and machinery.
3. The Company will continue to trade and do business in Ireland. It is closing down its manufacturing process but will continue to reap the benefits of trading here. In order to do this it will expect the ongoing goodwill of its Irish customers and in turn should show example by treating workers in a fair manner by paying them the redundancy terms of the 1997 agreement.
COMPANY'S ARGUMENTS:
4. 1. The Company was forced to close the plant because of the major losses incurred. Unfortunately the Company is not in a position to pay the workers the 1997 redundancy package. Since that time there have been dramatic changes both within the Company and in the market that it operates in. The Company regrets that it is not in a position to offer a more generous package. It cannot afford to pay anything in excess of what is offered.
2. The Union has highlighted the prospective sale of the Portlaoise factory as generating income to finance a more generous settlement. Management, however, does not know how much this will generate and there are loans secured on these assets which will have first call on any income raised.
RECOMMENDATION:
The Court has carefully evaluated the submissions of the parties in this case. The Court notes that the decision to close the business was taken voluntarily and that all staff are to be made compulsorily redundant.
The Court does not accept that the circumstances of the Company have changed to such a degree as to justify a departure from the restructuring redundancy terms previously applied. Accordingly, the Court recommends that the terms applied in 1997 be applied in the present case.
Signed on behalf of the Labour Court
Kevin Duffy
17th August, 1999______________________
T.O'D./D.T.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.