FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : HENRY DENNY & SONS - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Murphy Worker Member: Mr Nash |
1. Redundancy Terms
BACKGROUND:
2. The dispute before the Court concerns the redundancy terms offered to employees at the Company. Following a review of operations the Company sought voluntary redundancies. Due to the low uptake of this offer compulsory redundancies became necessary. The Union argued that the history within the Company was that all redundancies would be on a voluntary basis.The Company offered to pay 4 weeks pay per year of service plus statutory redundancy. This includes a deduction of 40% of the difference between the new and the old statutory redundancy terms. This is done so to take account of the new statutory redundancy terms introduced in 2003. The Union seek to have the deducted 40% paid to its members in this case of compulsory redundancies.
The dispute could not be resolved at local level and as the subject of a Conciliation Conference under the auspices of the Labour Relations Commission. As agreement could not be reached, the dispute was referred to the Labour Court on the 14th January, 2008 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 6th March, 2008.
UNION'S ARGUMENTS:
3. 1 The situation is that 36 members face being made redundant in a town with the second highest rate of unemployment in the Country. The Union are seeking to have the current package of 4 weeks pay for every years service plus statutory redundancy including the 40% the Company deducts of the difference between the new and old statutory redundancy terms paid to its members.
2 The Company has moved production to other plants. It is not at any loss by doing so but the Union's members are.
3 In Labour Court Recommendation 18139, the Court granted the 40% back to the employee. Any increase in the package would be of help to the Union's member's and to the remaining workers at the Company who, the Union contend, have no future there as the Company will close in totality in the next number of months.
COMPANY'S ARGUMENTS:
4. 1 The Company feels the severance terms compare very favourably with redundancy payments in other companies in the same sector.
2 The Company reviewed the redundancy package offered in monetary terms and it represents a very sizable compensation.
3 The Company has paid exceptionally enhanced terms at an additional cost despite the current commercial position of the Company. Any further enhancements will have serious cost implications for the Company.
RECOMMENDATION:
The case before the Court concerns a dispute between the parties over the redundancy terms which should apply to the proposed imminent compulsory redundancies arising from the cessation of bacon processing at Henry Denny & Sons (Tralee) Limited. The Company offered to pay 4 weeks pay per year of service plus statutory, with the addition of the notional pay as recommended by the Labour Court in April 2007 in LCR No: 18876. However, it explained to the Court that this formula deducts 40% (of the difference between the new and the old statutory redundancy terms in each case), which has been applied to take account of the new statutory redundancy terms introduced in 2003.
Due to the compulsory nature of these redundancies, the Union sought application of the Company’s formula without the deduction of 40% factor.
The Court notes that the current redundancy terms were agreed following LCR No: 18876 in April 2007, as an exceptional measure due to the particular circumstances pertaining at the Tralee plant at the time. Having considered the oral and written submissions of both parties, the Court recommends that the redundancy formula recommended for the Tralee plant in LCR No: 18876 “namely 4 weeks pay per year of service plus statutory entitlements, without the application of a cap”plus the notional payment,should apply in the present circumstances. Therefore, the Court recommends that the deduction of the 40% factor should not apply.
The Court so recommends.
Signed on behalf of the Labour Court
Caroline Jenkinson
28th March, 2008______________________
DNDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to David P Noonan, Court Secretary.