FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 20(2), INDUSTRIAL RELATIONS ACT, 1969 PARTIES : WINCANTON (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Mr Duffy Employer Member: Ms Doyle Worker Member: Mr Shanahan |
1. Redundancy Payments.
BACKGROUND:
2. The case before the Court concerns a dispute between the Employer and the Union on behalf of its members in relation to redundancy payments. The Union is seeking a redundancy package in line with industry norms and with previous packages offered, on behalf of its members who are employed by the Company, however who are servicing two seperate client contracts held by the Employer. The Union is primarily disputing the requirement of the redundancies required by the first client contract. The Union contends that in this instance there is no apparent need for the redundancies sought by the Company however if such redundancies are to be effected, the Union is seeking a redundancy package consisting of 4.5 weeks' pay per year of service over and above statutory entitlements in addition to an ex-gratia lump sum payment reflecting the number of years of service given by the employees. The Employer rejects the Union's claim, maintaining that the redundancies are being sought by its client and as such must be carried out. In terms of the redundancy package sought by the Union, the Employer, in accordance with the prerequisites outlined by its client, is not in a position to fund the package and so rejects the Union's claim.
In relation to the second external client relevant to this dispute, the Union on behalf of two of its members is seeking an enhanced redundancy package consisting of an historically agreed amount of 4.5 weeks' pay per year of service in addition to statutory entitlements and an ex-gratia lump sum payment relevant to each employee's number of years of service. In this circumstance, the Employer has already forfeited this client contract and as a result there is no dispute as to the existence of the redundancy situation. The Employer's position is that it has no alternative other than to offer a redundancy package consisting of statutory entitlements only. The Union disputes the Employer's position.
The dispute was referred to the Labour Court on the 28th March, 2012 in accordance with Section 20(2) of the Industrial Relations Act, 1969 and both parties agreed to be bound by the Recommendation. A Labour Court hearing took place on the 27th April, 2012.
UNION'S ARGUMENTS:
3. 1. The redundancy packages offered by the Employer are out of line with industry norms and redundancy packages previously paid by the Company.
2. Furthermore, they do not reflect the level of service given to the Company by these employees.
EMPLOYER'S ARGUMENTS:
4. 1. The Employer operates on the requirements of the contracts held with its clients.
2. The Employer is not in a position to offer enhanced redundancy packages outside of what is offered by its client companies.
RECOMMENDATION:
It is noted that the Company have offered different redundancy terms based on the contract from which the workers are to be made redundant. In the Court’s view such an approach is neither fair nor reasonable. Accordingly this recommendation is intended to apply to all five redundancies to which this dispute relates.
It is further noted that the Union disputes the need for redundancies, arising from the loss of one contract. However the Court has not been provided with sufficient evidence upon which it could conclude that redundancies are avoidable in consequence of the loss of the business concerned.
In recommendation LCR20059 the Court recommended, in effect, that the parties enter into negotiations with a view to concluding a revised agreement on the terms to be applied to future redundancies. No such negotiations have taken place.
The Court remains convinced that the terms historically applied should be reviewed in light of the changes that have taken place in the structure of the industry and in more recent trends on redundancy settlements in analogous employments. It is, however, recognised that there is an urgency to deal with the current redundancies and in these circumstances the Court believes that an interim redundancy arrangement should be put in place in the following terms: -
- 1. Those being made redundant should be paid statutory redundancy plus three week’s pay per year of service calculated on basic pay plus shift allowance.
- 2. A further lump sum of €5,000 should be paid regardless of service.
- 3. Negotiations on a new agreement on redundancy terms, in line with LCR20059, should take place without further delay. If these negotiations result in better terms than those recommended above the difference should be paid to those to affected by the current redundancy.
- 4. Should the parties fail to reach agreement within a eight week period the matter may be referred back to the Court under for a binding decision.
Signed on behalf of the Labour Court
Kevin Duffy
30th April 2012______________________
SCChairman
NOTE
Enquiries concerning this Recommendation should be addressed to Sharon Cahill, Court Secretary.