FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : BITECH ENGINEERING (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Doherty Worker Member: Mr O'Neill |
1. Redundancy
BACKGROUND:
2. This dispute concerns the redundancy terms offered by the Company plus a claim for the reopening of the voluntary redundancy application process. The Company has said that it can only pay statutory redundancy payments and the Union is seeking an enhanced package of two weeks' pay per year of service in addition to the statutory redundancy payment.
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 28th August, 2009, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 9th October, 2009, the earliest date suitable to the parties.
UNION'S ARGUMENTS:
3. 1. The Company is part of the very profitable Glen Dimplex multinational group of companies.
2. Redundancy payments in excess of statutory entitlements have been paid by Glen Dimplex companies in this State and in Northern Ireland.
3.The drop in demand for the Company's products is due to production being transferred to other Glen Dimplex plants abroad.
EMPLOYER'S ARGUMENTS:
4. 1. The Company is not competitive and these redundancies are an essential element of a cost-cutting survival plan.
2. Concession of this claim would threaten the continuing employment of the remaining staff.
3.The Union's claim for enhanced redundancy payments is undermined by the fact that this voluntary redundancy scheme is already over-subscribed.
RECOMMENDATION:
The matter before the Court concerns the Union's claim for an enhanced redundancy package for 59 employees who volunteered for redundancy plus 5 who were declared redundant in June 2009. The Company sought volunteers on the basis of paying statutory redundancy payments only. The number of volunteers exceeded the number of redundancies required. The Union sought an enhanced package of two weeks pay per year of service in addition to the statutory redundancy payment and sought to have the voluntary application process reopened.
The Company outlined the unprecedented economic difficulties it is facing at this time, saying it had no funding available to pay an ex-gratia payment and if it had to do so it would put the future of the Company at further serious risk, jobs would be further threatened. Furthermore, the Company stated that the remaining 241 employees would have to endure a range of other cost reduction measures as part of its efforts to maintain the viability of the business going forward. Therefore, it rejected the claim.
Having considered the submissions of both parties, taking all factors into account the Court does not recommend concession of the Union’s claim. However, the Court recommends that the calculations of payments for redundancy purposes should be based on average earnings rather than on the statutory basis, i.e. the statutory ceiling should not apply and individual workers should have their payments based on their average earnings.
In the current circumstances, the Company stated that there is no need for further redundancies therefore, the Court sees no merit in recommending the reopening of the voluntary application process.
The Court so recommends.
Signed on behalf of the Labour Court
Caroline Jenkinson
20th October, 2009______________________
JMcCDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Jonathan McCabe, Court Secretary.