FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2001 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : TARA MINES (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - GROUP OF UNIONS DIVISION : Chairman: Mr Flood Employer Member: Mr McHenry Worker Member: Mr. Somers |
1. Lay-offs
BACKGROUND:
2. The Company is a wholly owned subsidiary of Outokumpu Oyj, a Finnish based metals company, and it operates a zinc/lead mine in Navan, Co. Meath. It commenced operations in 1977 and presently employs approximately 700 workers. The Company is Europe's largest zinc producer. Zinc is mainly used in the automobile and construction industries.
The Unions' claim relates to the Company's decision to lay off 650 workers indefinitely (beginning on the 17th of November, 2001) and retain the remaining workers on care and maintenance only. A major cause of concern to the Unions is the date of resumption of operations. The Company's reason for the lay-offs is its claims that the price of zinc has dropped from $1,200 per tonne in September, 2000, to $740 per tonne at present, the lowest zinc prices in real terms since operations began at the Company. The Company will make a comprehensive review of the situation in mid January, 2002. If the indications are positive, it intends to commence a major investment programme, hopefully in late February/early March, 2002. However, the Company believes that it is unlikely to start full production before May, 2002. The Unions are seeking the following:-
Agreement that in the absence of assurances in respect of a return to work within a 13 week period following layoff - proper severance terms would apply.
These terms should be no less favourable than those applying at Tara Mines when redundancies were required in 1995.
The dispute was referred to the Labour Relations Commission and a conciliation conference took place on the 16th of November 2001. As the parties could not reach agreement, the dispute was referred to the Labour Court on the same day in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 21st of November, 2001.
UNIONS' ARGUMENTS:
3. 1. The announcement by Outokumpu Oyj Corporate Management on the 1st of November, 2001, that it had decided to exit base metals mining has left the workers - some with 25 years service - and their families very insecure about the future.
2. Since 1997, the workers have agreed to 3 radical reviews of their terms and conditions of employment so as to protect their jobs in the long term. The workers have faced insecurity in their jobs for the last 5 years at this time of the year.
3. The Company has given no details on the criteria on which it will resume operations, something which has added to the insecurity. The workers have co-operated fully with the winding down of operations.
4. The uncertainty for the employees and their families is unacceptable.
COMPANY'S ARGUMENTS:
4. 1. The decision which has caused the temporary suspension of operations at Tara Mines is due to the global economic downturn. This has resulted in zinc prices dropping to an historically low price of $740 per tonne. At the start of the year the base forecast price for zinc for the year was $1,168 per tonne. This has resulted in huge losses for the Company. The Company has no choice but to suspend operations on a temporary basis.
2. The decision is purely a business decision. There are no hidden agendas, no redundancies are being sought and there is no proposal to sell the mine.
3. The Company has already invested heavily in the mine since 1999 (details supplied to the Court). It is also committed to a further investment of approximately 10 million Euro in 2002 when the price trend is sufficient to allow the Company to become a viable operation.
RECOMMENDATION:
The Company has argued that it is not in a position to give a date for recommencement of work but is hopeful that a favourable decision can be made in January.
The Unions are critical of the Company's refusal to put a date on the recommencement of work and the fact that the Company refused to be specific as to the criteria to be used in making such a decision.
The Court is influenced by the Company's confidence that the price of zinc will improve and its commitment to investment in the plant.
However, the Court accepts the Unions' argument that the welfare of the employees and their families cannot remain on hold indefinitely, and that some mechanism must be put in place to address their concerns.
Having considered all of the information before it, and in an attempt to avoid making long term recommendations at this stage that may be unhelpful to all concerned, the Court recommends as follows:-
1. The Company review to take place in January as proposed, and the Court to be fully briefed on the outcome of this review and the decisions on recommencement of work.
2. If at that stage, the plan, as proposed in the Company's submission is not proceeding as outlined, the Court will make a definitive recommendation on the issues currently before it.
3. If the review is postponed or does not take place for any other reason, then the Court will act as outlined in No. 2 above if requested to do so by either party.
Signed on behalf of the Labour Court
Finbarr Flood
29th November, 2001______________________
CON/CCChairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.