LCR16065

SUBJECT:
1. (1) Redundancy package, (2) Manning levels, (3) Sequence of layoffs of temporary staff, (4) Status of one employee.



BACKGROUND:

2. The Company manufactures corrugated packaging for the manufacturing and food sectors. It employs 190 workers, of whom 137 are involved in the claim.

In September, 1996, the parties agreed a programme for partnership, Vision 2000, which was designed to help the Company's survival. Part of the deal involved a new pay and remuneration package based on achieving a 30% increase in productivity. The Company claims that this increase has not taken place, and has resulted in the present dispute. Briefly, the four issues are as follows:-

(1)Redundancy package

In July, 1998, the Company proposed a reduction of 21 workers. The redundancy package offered was the same as that offered in a small number of redundancies in 1996 i.e., £750 per year of service, plus 2 weeks' holiday pay, plus statutory redundancy, plus payment in lieu of notice, plus holiday entitlements. The Union is seeking an improvement on this offer.

(2)Manning levels

At present, there is a flexible agreement regarding the manning levels. Original manning levels were 115 based on a 2-shift operation. With the move to 3-shifts, the levels were increased to 148. The Company now proposed a level of 127 permanent workers plus 6 temporary. The Union feels that the proposed numbers are not sufficient.

(3)Sequence of lay-offs of temporary staff

The Union claims that a number of temporary staff had been made permanent out of the normal sequence of converting to permanent status i.e., that the 'last-in, first-out' rule did not apply.

(4)Status of one employee

The worker concerned started employment on the 22nd of September, 1997, on a three-month probationary period. In January, 1998, he had a workplace accident and was out of work for several weeks. The Union claims that rosters in March, 1998, showed the worker as permanent. The Company maintains that the worker is still on probation.

The dispute was referred to the Labour Relations Commission, and a conciliation conference took place on the 17th of November, 1998. As the parties did not reach agreement, the dispute was referred to the Labour Court on the 24th of November, 1998, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 10th of December, 1998, in Cork.



UNION'S ARGUMENTS:

3. 1. Redundancy package

In the 1996 offer, £750 equated to 3 weeks' pay. The Union is seeking the equivalent of 3 weeks' current pay, which would be in excess of £750. Vision 2000 stated "no compulsory redundancies across the plant ...". The Company has indicated that there could now be enforced redundancies. The proposed savings for the Company are in the region of £600,000.

2. Manning levels

The Company's proposals could put a large number of jobs at risk. It is not possible to increase production and maintain a 3rd shift with a crewing level of 127. The Union proposed that a project team examine the manning levels but the Company did not act upon the proposal.

3. Sequence of lay-offs of temporary staff

It has been custom and practice at the Company for 25 years that first-in, last-out applies in redundancy situations. This custom has changed recently, with the Company promoting some temporary workers out of sequence, resulting in some workers with longer service being made redundant.

4. Status of one employee

A workforce listing on the 16th of March, 1998, deemed that the worker was permanent. Nine employees who started employment with the worker concerned on the same day, or later, have since been made permanent.



COMPANY'S ARGUMENTS:

4. 1. Redundancy package

The Company has to make a number of workers redundant because of its financial position. The redundancy package is fair and reasonable, and was implemented as recently as December, 1996. The claim is cost-increasing under the terms of Partnership 2000.

2. Manning levels

Vision 2000 provides for flexibility in the manning levels, and the Company has to ensure that the productivity levels are appropriate and realistic. The Company's proposals will ensure job security.

3. Sequence of lay-offs of temporary staff

In late 1997, a number of temporary staff were recruited. Subsequently, a number of permanent vacancies arose. The positions were advertised, following representation from the Union. Interviews were held and the suitable candidates appointed. When a number of temporary workers were let go in August, 1998, (due to an excess of temporary workers) the employees objected and took unofficial industrial action which seriously harmed the Company. It is normal practice that temporary workers are first to be affected in a redundancy situation. The Company has the right to select the most suitable candidates when permanent positions arise. The Union did not object at the time of the appointments.

4. Status of one employee

The Company has the right to assess the suitability of a new employee during a probationary period. In this case, the worker was absent on sick-leave for a considerable time and his probationary period was put back. The Company will review his position.




RECOMMENDATION:

Having considered the submissions of the parties on the issues in dispute, the Court recommends as follows:-

Redundancy Package
The Court notes that the Company is prepared to implement the proposed redundancies on a voluntary basis, and is confident that sufficient volunteers will be available. On that basis, the Court does not see any grounds on which a significant alteration to the previously agreed redundancy package would be warranted. The Court does recommend that the lump sum of £750 per year of service should be increased by the percentage increases in basic pay provided in national wage rounds in the intervening period since the package was first agreed. The Court also understands that the two weeks' holiday pay element will be calculated at the new consolidated rate.

Crewing Levels
The Court notes that in the course of the hearing it was indicated on behalf of the Company that it was not opposed to the Union's proposal to have this matter dealt with by a joint project team in the first instance. On that basis, the Court recommends that this issue be processed in the manner proposed.

Lay-Off of Temporary Employees
In the course of the hearing, the Company confirmed that it accepts the principle of L.I.F.O. in relation to lay-off of temporary staff.

The Court accepts that the Company has maintained a long standing practice of appointing temporary staff to permanent positions on the basis of seniority. In the absence of a clear agreement to depart from this practice, the Court recommends that it be maintained.

Status of one employee
The Court accepts that the Company acted properly in not regarding the employee's period of sick leave as part of his probationary period. The Court recommends that the Company now makes its decision in relation to this employee.




Signed on behalf of the Labour Court



Kevin Duffy
5th January, 1999______________________
C.O'.N./D.T.Deputy Chairman



NOTE

Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.