FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : ARNOTTS - AND - MANDATE DIVISION : Chairman: Mr Duffy Employer Member: Mr Doherty Worker Member: Mr Nash |
1. Redundancy Terms.
BACKGROUND:
2. In February, 2008 the Company announced plans of a €750 million redevelopment of the area bordered by Henry St., Middle Abbey St., Liffey St., and O'Connell St. Due to planning issues the Boyers and Arnotts Department Stores will now continue to trade until 2010 but in the meantime jobs within the accounts payable section will be outsourced thus rendering 25 staff compulsorily redundant. The terms of the redundancy package was rejected by the Union as inadequate, given that alternative employment on similar terms and conditions would be hard to find given the current economic downturn.
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 5th September 2008 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 8th October, 2008.
UNION'S ARGUMENTS:
3. 1. An increase of 2 weeks pay per year of service on top of the 5 weeks already offered on the 25th February, 2008, would be fair and reasonable given that the redundancies are compulsory.
2. The imposition of a cap on the redundancy lump sum has a discriminatory effect on those Workers with longer service and therefore impacts on the older Worker who has given many years dedicated service to the Company. It is argued that this is unlawful under Employment Equality Legislation.
3. A performance bonus is paid to 5 of the individuals involved and as it forms an integral part of their earnings, it should be taken into account when calculating their redundancy package.
4. The 3 individuals with less than two years service should be awarded an ex-gratia payment of 5 weeks pay per year of service.
5. Compensation is sought on behalf of the one individual who has enjoyed the use of a Company car for the past 8 years.
COMPANY'S ARGUMENTS:
4. 1. The offer of 5 weeks pay per year of service inclusive of statutory redundancy payment subject to a cap of €90,000 or 2.5 years basic pay which ever is the greater has been accepted by 46 staff since November 2006 and this number includes 2 individuals who are part of the current round of redundancies.
2. At conciliation a weeks pay was defined to include commission, overtime, Christmas week, merit or attendance bonus and car allowance only, performance bonus and BIK was not included.
3. Trading conditions are markedly worse than when Recommendation LCR18785 was issued and therefore the Company is seeking that the terms outlined be reaffirmed by the Court.
RECOMMENDATION:
The Court is of the view that the circumstances giving rise to the current redundancies are different to those which pertained when the formula proposed by the Company was originally devised.
The Court recommends that in the circumstances of this case the Company should offer and the Union should accept a package comprising five and one half weeks pay per year of service, inclusive of statutory entitlements without the imposition of a cap. However, no individual should receive more by way of redundancy pay than they could potentially earn up to normal retirement age.
Bonus payments
Performance bonus, where applicable, should be included in the redundancy calculations.
Staff with less than two years service
Those with less than two years service should receive an ex-gratia payment of five weeks pay per year of service.
Car
The Court does not recommend compensation for the loss of the Company car used by one individual.
Future redundancies
This recommendation is made in respect of the redundancies due to take effect at the end of October 2008. It is noted that there is the possibility of further significant redundancies arising from the plans for the future redevelopment of the Company’s store. In the event of those redundancies proceeding the terms applicable should be the subject of further negotiations between the parties. Neither this or previous Court recommendation in relation to specific incidents of redundancy should be regarded as a precedent.
Signed on behalf of the Labour Court
Kevin Duffy
10th October, 2008______________________
JFChairman
NOTE
Enquiries concerning this Recommendation should be addressed to John Foley, Court Secretary.