FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : SCHINDLER LIMITED TRADING AS SCHINDLER LIFTS IRELAND (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - TECHNICAL, ENGINEERING AND ELECTRICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Mr Murphy Worker Member: Mr Nash |
1. Redundancy selection.
BACKGROUND:
2. Schindler Ltd. trading as Schindler Lifts Ireland is the fourth largest lift Company in Ireland and is part of the Schindler Group which is the worlds largest supplier of escalators and the second largest manufacturer of elevators. Due to the country's economic downturn the Company announced the need for redundancies amongst its direct Employees but a dispute arose concerning the interpretation of the criteria to be used for redundancy selection by means of the Last In / First Out (LIFO) principle.
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 jointly referred to the Labour Court on the 1st October, 2009, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 12th November, 2009.
UNION'S ARGUMENTS:
3. 1. The nature of a contract of apprenticeship and a normal contract of service differs widely in that if a category of Worker is targeted for compulsory redundancy then the reckonable service in that category is the only service to be considered for the application of LIFO.
2. Precedence has been set on this matter before and the Labour Court has on a number occasions confirmed its view that the period of apprenticeship should not be reckonable with regard to the application of LIFO.
COMPANY'S ARGUMENTS:
4. 1. The Company's interpretation is that the LIFO principle ought to be solely based on an Employee's complete length of consecutive service with the Company.
2. To quote the Unfair Dismissal Acts 1977-2001, Section (1) clarifies that ""contract of employment" means a contract of service or of apprenticeship..." and the legislation therefore does not differentiate between a contract of employment and a contract of apprenticeship.
3. To treat an employee less favourably on the grounds of the time that they were an apprentice is unreasonable and unjust from an industrial relations perspective.
RECOMMENDATION:
The dispute concerns the application of LIFO, as the selection criterion for redundancy, where part of a Worker's service is accounted for by a period of apprenticeship. The Union contends that the generally accepted position is that only service post-apprenticeship is reckonable. The Employer contends that all service should be taken into account and that any other approach would be inconsistent with the provisions of the Redundancy Payments Acts 1967-2007 and the Unfair Dismissals Acts 1977-2007.
In the Court's view both arguments are cogent. The determinative consideration, from an industrial relations perspective, should be the normal or accepted practice in comparable employments. While it is clear that the Union has consistently maintained a position of only recognising post-apprenticeship service, there is nothing in the nature of a formal agreement, in this or other industries, to that effect.
In considering this case the Court has had particular regard to Recommendation LCR19654 in which it was held that service should be calculated in the manner contended for by the Union. While the circumstances pertaining in that case were somewhat different to those giving rise to the present case, the Court believes, on balance, that the employer should agree to the Union's proposal in this instance and recommends accordingly.
In making this recommendation the Court is strongly of the view that there is an urgent need for Trade Unions and Employers to formulate a generally accepted approach to cases such as this. The Court further recommends that the parties should seek to establish, at an appropriate national level, a common understanding, or code of practice, on the calculation of service for the purposes of applying LIFO where part of the service in issue is accounted for by apprenticeship.
Signed on behalf of the Labour Court
Kevin Duffy
26th November, 2009______________________
JFChairman
NOTE
Enquiries concerning this Recommendation should be addressed to John Foley, Court Secretary.