FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : CLG DEVELOPMENTS LTD (REPRESENTED BY ESA CONSULTANTS) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Murphy Worker Member: Mr Nash |
1. Redundancy, Selection Criteria and Enhanced Redundancy Payment.
BACKGROUND:
2. This dispute concerns the Company's intention to make a number of its workers redundant. The Union claims that these workers are being made redundant and replaced with sub-contractors. The Company claims that the redundancies are required due to a sudden and significant decline in its business coupled with the loss of one of its contracts with Bord Gáis �ireann.
This 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 2nd December 2008, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 8th December 2008, the earliest date suitable to the parties.
UNION'S ARGUMENTS:
3. 1. The work currently being done by sub-contractors can be done equally efficiently by the direct employees whom the Company is seeking to make redundant.
2. The Union has proposed meeting with the Company in an attempt to protect all jobs by making the Company more efficient and profitable.
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3.If, however, there are to be any redundancies the Company should offer an enhanced redundancy package in line with that offered in the sector.
COMPANY'S ARGUMENTS:
4. 1. The Company is not attempting to make its direct employees redundant so that it can outsource the direct employees' work.
2. The Company no longer has any work for the direct employees it wishes to make redundant.
3.The sub-contractors engaged by the Company are engaged in specialised work which they do more efficiently than the Company's direct labour.
RECOMMENDATION:
The matter before the Court concerns the Union’s objection to the Company’s proposed redundancies. The Union requires the Company to negotiate an arrangement whereby there will be no immediate redundancies within the Company and, in the event of redundancies arising in the future, it sought a selection procedure based on seniority with retention of key skills and an enhanced severance package.
The Company stated that the need for redundancies has arisen due to a sudden and very significant decline in its business coupled with the loss of one of its contracts with Bord Gáis �ireann resulting in the urgent need to reduce its workforce substantially. Furthermore, it stated that due to its consequent serious financial losses the Company needs to restructure and to very significantly improve its efficiency/productivity levels (i.e. an improvement of 40%). In that regard the Company has issued redundancy notice to 51 employees to expire on 13th December 2008.
The Union accepts the Company’s needs accordingly to significantly improve its efficiency/productivity levels and has indicated its commitment to engage immediately to have these matters appropriately and fully addressed. However, it has serious difficulties with the Company’s plans to make employees redundant while it continues to engage sub-contractors.
Having carefully considered both the written and oral submissions of the parties, the Court notes the limited amount of work available at present and recognises the urgency of having these matters addressed immediately and accordingly makes the following recommendation:
- The Company should offer a voluntary redundancy severance package to those employees currently under notice which they in turn must opt for if they decide to do so, by the the deadline date of 13th December 2008 on the following terms:-
-employees with less than 1 year’s service €1000;
-employees with less than 2 years’ service €2000; and
-employees with more than 2 years’ service should be paid 2 ½ weeks’ pay per year of service plus statutory redundancy payments.
- In the event of insufficient volunteers being forthcoming by the 13th December 2008 deadline, the Court recommends that the parties should enter into immediate negotiations to achieve the required efficiency/ productivity levels (i.e. an improvement of 40%), by no later than 9th January 2009. Following such agreement and in the event that there is still a need for a reduction in the number of employees, then the Court recommends that the Company should reduce their contract personnel by a commensurate number.
The Court so recommends.
Signed on behalf of the Labour Court
Caroline Jenkinson
9th December, 2008______________________
JMcCDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Jonathan McCabe, Court Secretary.