FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : BORD NA MONA - AND - UNITE DIVISION : Chairman: Ms Jenkinson Employer Member: Ms Cryan Worker Member: Mr Shanahan |
1. Unilateral removal of Company Car and compensation offered
BACKGROUND:
2. The Union's case concerns 9 workers who have been provided with a company car as part of their terms and conditions of employment. In 2010 the Company decided to withdraw the use of the car from the 9 workers who are employed in a variety of sections. It claims that the Company's decision to withdraw the cars was unilateral. The Company's case is that the workers' "job size/role" no longer merited having the car, based on the value of the car being €10,000 per annum. It offered to compensate the workers with 1.5 times the annual loss which was rejected by the Union.
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 14th June, 2011, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 30th September, 2011.
UNION'S ARGUMENTS:
3. 1. There were no discussions between the parties before the Company decided to withdraw the use of the car from the 9 workers. They were the only ones from a large number of employees (approximately 165) who have company cars who were targeted in this manner.
2. The Company offered no objective justification for the selection of the staff who had their car removed.
3. The company car was "part & parcel" of the workers' terms and conditions of employment. The average annual loss is €13,316 per worker.
COMPANY'S ARGUMENTS:
4. 1. The 9 workers concerned are the only ones with their role who have the benefit of a car. Other employees doing similar work do not have one, something the Company thought unfair.
2. The workers were given plenty of notice before the use of the car was taken away.
3. The Company is facing significant challenges at the moment and needs to put cost-saving measures in place. Despite this it offered to pay 1.5 times the annual loss to the workers which is standard compensation in these cases.
RECOMMENDATION:
- The matter before the Court concerns the Union’s claims over the Company’s removal of a company car from nine Claimants. The Union submitted that the Company had unilaterally changed the Claimants’ contractual terms, without any consultation beforehand, without specifying the objective criteria whereby some employees retained a company car while others did not and finally to the level of compensation offered for the enforced change.
The Company submitted that the removal of the company car to the Claimants involved came about following an evaluation exercise carried out on the job functions involved and in an effort to introduce a more transparent Company Car Policy.
Having considered the submissions of both parties, the Court notes that the contractual arrangements of the employees involved in this claim specify that a company car will be provided as part of their total remuneration package. In such circumstances the Court takes the view that it was not appropriate to withdraw an element of their remuneration without entering into negotiations and reaching an agreement on the matter.
Therefore, the Court does not uphold the Company’s removal of the company car in the manner in which this took place and, accordingly, recommends that the parties should enter into meaningful negotiations within the context of the employees' contract of employment on any proposed changes which may need to be made to those contracts.
The Court so recommends.
Signed on behalf of the Labour Court
Caroline Jenkinson
6th October, 2011______________________
CONDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.