FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2004 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : FRAWLEYS DEPARTMENT STORE (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - MANDATE DIVISION : Chairman: Mr McGee Employer Member: Mr Grier Worker Member: Mr O'Neill |
1. Severance terms / closure of Company.
BACKGROUND:
2. Frawley's is a long established department store trading at 34-36 Thomas Street, Dublin since 1892. On the 15th March, 2007 the Company wrote to the Union informing them of the decision to cease trading within three months. The Company proposed a redundancy payment of two and a half weeks pay per year of service inclusive of statutory entitlements.
The staff representatives found this offer unacceptable and the Union, on behalf of its members, put in a claim for six weeks pay per year of service inclusive of statutory entitlements. Following a meeting between the parties the Company increased its offer to three weeks pay per year of service inclusive of statutory entitlements. This was still unacceptable to the Union.
The dispute could not be resolved at local level and 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 15th May, 2007, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 25th May, 2007.
UNION'S ARGUMENTS:
3. 1. The Union believes that the Company will benefit financially from the sale and subsequent re-development of the site of the store.
2. It is going to be extremely difficult for more senior staff to obtain work of any sort, much less similar employment following redundancy.
3. The staff have always co-operated fully with Management and they have a deep sense of loyalty to the Company.
COMPANsY'S ARGUMENTS:
4. 1. The redundancy payment sought by the Union is utterly unrealistic and excessive. Frawley's have operated on a break-even basis for the past ten years. Although a department store Frawley's cannot be reasonably be compared with other established Dublin city centre department stores for redundancy purposes.
2. The severance offered of three weeks inclusive is fair and reasonable in the context of a business that has struggled to stay viable for at least 10 years.
3. The Company has taken steps to ensure that the pension scheme is fully funded and has also incurred a cost for the administration and winding up of the scheme.
RECOMMENDATION:
Having considered the submissions of the parties. the Court recommends that the Company offer on severance terms be increased to two weeks' pay per year of service in addition to statutory entitlements and that this should be accepted by the Union.
Signed on behalf of the Labour Court
Raymond McGee
28th May, 2007______________________
MG.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Madelon Geoghegan, Court Secretary.