FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : TORNIER ORTHOPAEDICS IRELAND LTD (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Murphy Worker Member: Mr Nash |
1. Claim for a package (redundancy, lump sum payment, pay increase) for relocation.
BACKGROUND:
2. The Company is a global Medical Device Company, manufacturing and distributing orthopaedic implants, sports medicine and biologic products. The Irish operation was established in Dunmanway, Co. Cork in 1980.
By 2008 it was clear that the Irish operation needed to expand as the space available at the Dunmanway facility was limited. A number of options were considered and following a detailed assessment it was decided to move to the IDA industrial estate in Macroom as a suitable building was immediately available that met all the relevant criteria. The Company relocated from Dunmanway, Co. Cork to Macroom, Co. Cork, a distance of 19 miles in June /July 2009.
The Company announced its relocation plans to the workforce at a meeting in November 2008. The general response was positive.
Following a general meeting of members the Union wrote to the Company setting out an agenda of items to be discussed in relation to the proposed relocation. The Union was seeking a relocation package comprising a number of items, namely:- relocation compensation of €8,000 (revised down from €10,000) per person, the payment of Phase 2 of Towards 2016, an increase in basic pay of 4% and a redundancy option of 3 weeks pay per year of service plus statutory payment for those who were unable to relocate.
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 November, 2009 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 16th July, 2010.
UNION'S ARGUMENTS:
3. 1. The Union maintains that the move is approximately 19 miles from site to site and that the Workers should be compensated for the extra travel time involved and the costs associated with increased use of the car by an increase in their basic wage.
2. The Union contends that the Company offer of €2,000 in total in two separate instalments in no way addresses the ongoing cost to its members as a result of the decision of the Company to relocate.
3. The Union maintains that the 2.5% due to its members under Phase 2 of the Towards 2016 Agreement is still outstanding. The Company has never indicated an inability to pay and therefore did not invoke Section 1.11 (ii) or (iii) of the Agreement.
4. The Union contends that there is a limited number of employees interested in a Redundancy option due to the stress caused to them by the move and that the Company should make this option available to these Workers.
COMPANY'S ARGUMENTS:
4. 1. The disturbance involved in the relocation was not overly excessive and benefitted some of the Employees in that it shortened the travel time to work.
2. The claim for a relocation package of €8,000 per person and a 4% wage increase is totally unrealistic and out of touch with the economic climate prevailing.
3. The Company considers that the interim payment of €1,000 and further offer of
€1,000 is a fair and reasonable compensation for the relocation.
4. All Workers have transferred to Macroom and have now worked at this location for 12 months. There is no redundancy situation existing.
RECOMMENDATION:
The Court had considered the oral and written submission on the four claims before the Court. The Company moved location in June/July 2009 from Dunmanway to Macroom, a distance of 19 miles. In consequence of the move the Union submitted three claims relating to the disturbance and inconvenience associated with the move.
Furthermore the Union submitted a claim for payment for phase three (2.5% due from 1st May 2009) underTowards 2016 Review and Transitional Arrangement.
The Court recommends as follows:
i) Disturbance Claims:
Lump Sum compensation
The Union sought €8,000 as compensation for the inconvenience involved, the extra distance and additional costs associated with the move. The Company offered a lump sum of €2,000 to be paid in two equal phases (one of which has already been paid).
In all the circumstances the Court recommends that the Company should improve its offer to pay a total lump sum of €3,000 in three equal phases.
Pay Increase
The Union sought a pay increase of 4% to compensate for the disturbance and costs associated with the move going forward.
The Court sees no justification for this claim and accordingly rejects the Union's claim.
Redundancy Option
The Union sought the option of redundancy with an average payment of three weeks' pay per year of service plus statutory for that limited number of employees who were affected to a significant extent by the move.
The Company informed the Court that no redundancy situation existed in the Company, however, it stated that it was prepared to consider the possibility of accommodating a limited number of workers to assist them to address particular personal difficulties encountered because of the move.
The Court is of the view that the Company's proposal to accommodate such employees should be availed of by those employees who brought such matters to the attention of the Union prior to the Labour Court hearing.
ii) Claim underTowards 2016, Review and Transitional Arrangements
The Union submitted a claim underTowards 2016 Review and Transitional Arrangementfor payment of the 3rd phase (2.5%) which was due from 1st May 2009. The Company deferred payment of the increase due to competitive pressures on the Company, however, it did not claim inability to pay the increase in part or in full as provided for under Clause 1.11(ii) or 1.11 (iii) of the Agreement.
In all the circumstances, the Court recommends that the Claimant's rate of pay should be increased by 2.5% and that that should be paid retrospectively to its due date, 1st May 2009.
In conclusion
The Court recommends that the lump sum retrospection due and the second phase of the disturbance payment should be paid within 4 weeks of acceptance by the Union of this Recommendation and the final phase of the disturbance payment should be paid on the 1st December 2010.
The Court so recommends.
Signed on behalf of the Labour Court
Caroline Jenkinson
29th July, 2010______________________
MG.Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Madelon Geoghegan, Court Secretary.