FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : HENRY DENNY & SONS (TRALEE) LIMITED - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Pierce Worker Member: Mr. Somers |
1. Rationalisation/Severance Terms
BACKGROUND:
2. Due to a combination of economic and environmental factors the Company, which is part of the Kerry Group, is to reconfigure its business. Accordingly, the pig-slaughtering element of the Company's operation is to cease, with the Company, in future, concentrating on developing and processing convenience products, thereby making it more cost-competitive within the industry. The dispute, essentially, revolves around voluntary severance terms for 64 of the Company's workforce of approximately 193. The dispute was the subject of a conciliation conference under the auspices of the Labour Relations Commission, at which the Company made an offer of three weeks' pay per year of service (pyos), plus statutory entitlements, a formula used previously in the plant (in 1995) and which is currently the standard within the Kerry Group. The Company's offer was rejected by the Union, which sought an enhanced package of up to 6 weeks' pay pyos, in line with certain other companies in the food industry.
Agreement, however, was not reached by the parties, and the dispute was referred to the Labour Court, on the 29th March, 2000, in accordance with Section 26(1) of the Industrial Relations Act, 1990. The Court carried out its investigation on the 30th March, 2000, and issued its recommendation, by letter, to the parties, on the 31st March, 2000.
COMPANY'S ARGUMENTS:
3. 1. The redundancy terms offered by the Company represent a fair and reasonable settlement for those losing their jobs. The Company is continually looking at reducing the numbers of workers affected by its new business direction. At present, it is emerging that the Company will be in a position to retain all employees, in the immediate future post-April 7, 2000. The number of jobs affected, subsequently, will reduce significantly over the next few weeks by means of:
1. re-training and redeployment within the plant;
2. re-training and alternative employment in other Kerry Group operations locally;
3. continued investment in remaining jobs.
2. In 1999, there have been as many settlements at 3 weeks' pay pyos, and lower, as there have been higher settlements. In Glanbia (6 weeks' pay pyos) and Glanbia (5 weeks' pay pyos), there were immediate cost-saving to the company on labour and plant, and no capital investment was involved. Other redundancy settlements in the food sector have been in relation to businesses that either completely closed down activities, or restructured in a major way, with significant job-losses. This is not the case with this Company which is embarked on a major research and development, and sales/marketing investment in order to secure a new business niche with ready-to-cook pork products.
UNION'S ARGUMENTS:
4. 1. The Union is seeking a substantial redundancy package, in line with packages available in the food industry in general. The Company had a turnover of £55m in 1998 and is part of the Kerry Group which recorded massive profits again this year.
2. Packages in the same sector of industry, of up to 6 weeks' pay pyos have been offered in many other companies (details supplied to the Court).
RECOMMENDATION:
Having considered all aspects of this dispute, the Court recommends that the Company's redundancy payment offer should be increased to 4 weeks' pay per year of service plus statutory redundancy entitlement.
The method of calculating a week's pay should be based on the average of the best 13 weeks' pay (basic, bonus and overtime) in 1999. The Court notes the Company's expectation that pay in lieu of notice can apply to those who are selected for the voluntary redundancy.
Signed on behalf of the Labour Court
Caroline Jenkinson
31st March, 2000______________________
MK/MKDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Michael Keegan, Court Secretary.