FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2004 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : PROCTOR & GAMBLE (MANUFACTURING) IRELAND LIMITED (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Grier Worker Member: Ms Ni Mhurchu |
1. Severance terms.
BACKGROUND:
2. Proctor & Gamble (Manufacturing) Ireland Limited is a subsidiary of a US owned multinational which has been in Nenagh for almost 30 years. The Company currently employs approximately 500 employees. A large number of the employees are represented by SIPTU.
In March, 2007 the Company announced the closure of its skincare plant at Nenagh with the loss of 280 jobs. The closure will take place in 2009 when the Company's production will transfer to a green field site in Poland. The Company will continue its cosmetics production at Nenagh with the maintenance of 220 jobs.
A series of communications took place between the Company and the employees. In May 2007 the first meetings concerning the Redundancy package and the selection method took place. The package the Company is offering is six weeks per year of service plus statutory redundancy and no cap. The selection methods were a) Selection Group - a number of groups determined by role and b) Selection Criteria - length of service weighted by skills, flexibility and performance. A thirty day information and consultative process ensued which concluded at the end of May without agreement being reached between the parties.
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 12th July, 2007, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 13th December, 2007
UNION'S ARGUMENTS:
3. 1.The Company have offered a redundancy packagein line with that given in 2000 i.e. 6 weeks per year of service plus the Act. Those redundancies were of a voluntary nature.
2. The Union are seeking 10 weeks pay per year of service plus Statutory redundancy, and no cap.
COMPANY'S ARGUMENTS:
4. 1.It is the Company's intention to offer voluntary redundancy in the first instance to all employees, and where there are insufficient applicants, the Company would then have to revert to a compulsory redundancy situation.The selection process is as outlined above.
2. The Company is offering a comprehensive, competitive redundancy packagewhich also includes
a) payment of Health Insurance for 1 year(or until alternative employment is obtained, whichever is first)
b) payment of Life Assurance up to date of next renewal (or until alternative employment is found, whichever is first)
c) continued membership of Employee Assistance Programme for 1 year (or until alternative employment is found, whichever is first); and
d) retention of Future Shares entitlement.
RECOMMENDATION:
In March 2007 the Company announced the closure of its skin care production plant at Nenagh, with the loss of 280 jobs, to take effect from 2009. The Company also announced the continuation of its cosmetic production activity with the maintenance of 220 jobs. The Company offered to pay a redundancy severance payment of
-6 weeks pay, inclusive of overtime and shift earnings, per year of service, plus
-statutory entitlements
-no ceiling on payments
-payment of health insurance for one year (or until alternative employment is obtained)
-payment of life assurance up to date of next renewal (or until alternative employment is obtained)
-continued membership of the Employee Assistance Programme for one years (or until alternative employment is obtained)
-retention of future shares entitlement
The Court notes that in order to ensure the success of its cosmetic production, the Company needs to retain key staff and have the right skills mix, consequently it is prepared to offer voluntary redundancy in the first instance to all employees and only where there are insufficient applicants, would it have to resort to compulsory redundancies, in 2009. It also offered transfers to other Proctor & Gamble locations where appropriate.
The Union sought an enhancement of the Company’s proposed redundancy package; it expressed dissatisfaction with the Company’s selection criteria and lack of consultation and sought selection on the basis of “Last in first out”.
In the first instance, the Court recommends that there should be appropriate engagement between both sides on all further issues in connection with this process and all matters must be dealt with through the Trade Union.
Having considered the oral and written submissions of both parties, the Court is of the view that the redundancy package on offer is a generous package and does not see merit in recommending an enhancement. The Court recommends that where it does not unduly affect the operations of the plant, the Company should accept application from workers who wish to avail of voluntary redundancy between now and 2009, on the basis of the redundancy package outlined above.
Furthermore, the Court recommends that early in 2009, there should be full engagement between the Company and the Trade Union on:
-a structured reduction in staff numbers in the plant
-future terms and conditions of employment
-future employments prospects for the workers involved, and
-the need to retain key employees and the right skill mix for the future needs of the Company.
The Court so recommends.
Signed on behalf of the Labour Court
Caroline Jenkinson
8th January, 2008______________________
MG.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Madelon Geoghegan, Court Secretary.