FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : DIAGEO - AND - TECHNICAL, ENGINEERING AND ELECTRICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Ms Doyle Worker Member: Mr Shanahan |
1. Calculation of redundancy.
BACKGROUND:
2. Following major rationalisation in 2009/2010 a large number of workers became redundant, many on a voluntary basis, including the 25 workers represented by the Union in the current case. The issue in dispute is the method of calculation of the redundancy which was proposed by the LRC. The statutory redundancy on offer (which originates from 2009) is 8 weeks' pay per year of service with a 2-year cap, plus "adjusted" statutory entitlement and an immediate actuarily-reduced pension. In return for an immediate pension the Company reduced the lump sum by 50%. However, the Union claims that the Company's method of calculation mean the some of its members are only receiving 43% of the lump sum rather than 50%. The Company's view is that the claim is fully compliant with legislation and also that it is cost increasing.
The dispute was referred to the Labour Relations Commission (LRC) and a conciliation conference took place. As the parties did not reach agreement, the dispute was referred to the Labour Court on the 23rd November, 2010, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 25th February, 2011.
UNION'S ARGUMENTS:
3. 1.The Company is still highly profitable. The current severance package was only constructed in late 2009 at which time the Company knew what the "new" statutory amounted to and, therefore, cannot argue that it is cost increasing.
COMPANY'S ARGUMENTS:
4. 1. In the 2009/2010 negotiations the new severance terms proposed by the LRC were agreed by all the Unions, including the TEEU, with which the Company had numerous discussions.
2. The package on offer is extremely generous, estimated by the Company as the highest on offer in the industry. It is also very costly to the Company.
RECOMMENDATION:
The Court recommends that all the parties accept the following principles:-
- 1. The lump-sum to which an employee is entitled under the Redundancy Payments Acts 1967-1993 cannot be interfered with or reduced by way of off-set or otherwise.
2. The redundancy package, including the mode of calculation, was agreed in 2010 and cannot be altered at this stage.
3. In the event of future redundancies the parties should enter into negotiations with a view to reaching agreement on a new redundancy package. Each party to those negotiations should be free to raise any issue which they consider appropriate. The resulting agreement should not be circumscribed by arrangements agreed or applied in the past, but should take full account of the principle referred to at 1 above.
Signed on behalf of the Labour Court
Kevin Duffy
11th March, 2011.______________________
CON.Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.