FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2001 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : IRISH GLASS BOTTLE COMPANY (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION TECHNICAL, ENGINEERING AND ELECTRICAL UNION BUILDING AND ALLIED TRADES UNION UNION OF CONSTRUCTION, ALLIED TRADES AND TECHNICIANS DIVISION : Chairman: Mr Duffy Employer Member: Mr Pierce Worker Member: Mr. Somers |
1. Severance terms.
BACKGROUND:
2. The Company is owned by Ardagh PLC. It is engaged in the manufacture, distribution and sale of glass containers to the food and drinks industries. It currently employs three hundred and sixty three workers at its plant in Ringsend. The Company is due to close on the 5th of July, 2002.
The dispute before the Court concerns a claim by the Unions for a significant improvement in the redundancy terms being offered. The Company rejects the claim.
The dispute was the subject of a conciliation conference under the auspices of the Labour Relations Commission. As agreement was not reached, the dispute was referred to the Labour Court on the 21st of May, 2002, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 28th of May, 2002.
UNIONS' ARGUMENTS:
3. 1. The workers concerned have given all their working lives to the Company, and feel that the Company has a responsibility to treat them with the appropriate dignity they deserve in respect of enhanced redundancy terms.
2. The average age of the workers concerned is between forty five and fifty therefore, re-employment may not be an option for many of them.
3. Funds can and must be made available for a substantial improvement in the redundancy terms being offered.
COMPANY'S ARGUMENTS:
4. 1. Management has always briefed the workforce regarding the deteriorating financial state of the Company, the deteriorating productivity levels, customer dissatisfaction and the Company's competitive position.
2. The only available funds to meet the cost of the severance package is from cash generated from the sale of existing stock, and the sale of products manufactured up until the date of closure of the plant.
RECOMMENDATION:
In circumstances where the Company is closing and all employees are being made compulsorily redundant, the Court does not consider that the previously agreed arrangement relating to voluntary severance would provide an appropriate level of compensation to those affected.
The Court has taken account of the financial circumstances of the Company. It has also taken account of the absolute requirement to achieve an orderly wind-down of the operation during which production is maintained to the optimum level of efficiency and quality.
The Court recommends that, subject to an orderly wind-down as referred to above being achieved up to the actual date of closure, the Company should modify its offer as follows:
- A total redundancy payment based on five weeks' pay per year of service, inclusive of statutory entitlements should be paid.
- Those with less than two years service should be included in the settlement subject to a reduction in the amount payable to take account of notional statutory payments relative to their service.
- The calculation of service should be in accordance with the provisions of the Redundancy Payment Acts 1967-1991.
- The amount payable to any individual should not exceed the amount of their potential earnings up to normal retirement age.
- On an optional basis employees should be provided with the facility to optimise their pension entitlement by using part of the lump sum to purchase an enhanced pension, where this is practicable.
Signed on behalf of the Labour Court
Kevin Duffy
7th June, 2002______________________
GB/MBDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Gerardine Buckley, Court Secretary.