FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : MOUNT CARMEL HOSPITAL (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - INMO SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION IRISH MUNICIPAL, PUBLIC AND CIVIL TRADE UNION MLSA DIVISION : Chairman: Ms Jenkinson Employer Member: Ms Cryan Worker Member: Ms Ni Mhurchu |
1. Formula for voluntary redundancy
BACKGROUND:
2. This dispute arose when the Employer notified the Unions it intended to introduce a voluntary redundancy scheme. 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 14th September, 2012, in accordance with Section 26(1) of the Industrial Relations Act, 1990.
A Labour Court hearing took place on the 2nd November, 2012.
UNION’S ARGUMENTS:
3. 1. The Public Sector pay and conditions of employment have generally been followed and observed by the Company. This has included introducing pay and annual leave reductions in line with Public Sector standards.
2. The Labour Court and Rights Commissioners Services have previously awarded enhanced redundancy payments where Employers argued they were in financial difficultly.
3. The Company is attempting to reduce its cost base to make it more attractive to potential buyers.
EMPLOYER'S ARGUMENTS:
4. 1. The hospital was bought by a developer in 2006. NAMA assumed responsibility for the hospital and its associated debt in late 2010.
2. A new CEO and management team were appointed to stabilise the business and execute a turnaround to enable NAMA to maximise a return of the taxpayers business through the sale of the business.
3. The Board cannot spend any money without the approval of NAMA and must reduce costs by €1.1 million.
RECOMMENDATION:
The claim before the Court concerns the Unions’ claim for an enhanced redundancy package. The Unions sought 3 week’s pay per year of service in addition to the statutory redundancy payment. The Hospital offered half-a-week’s pay per year of service in addition to the statutory redundancy payment, in two phases: - 50% within 6 months of exit date, and 50% within 12 months of exit date.
IBEC on behalf of the Hospital outlined to the Court that the Hospital had severe financial difficulties, it is technically insolvent and has been taken over by NAMA; consequently it was not in a position to enhance the offer made.
The Unions submitted to the Court that the terms of the Public Sector Voluntary Redundancy terms should apply in this case as the Hospital has generally applied Public Sector terms and conditions of employment, including reductions in pay as applied following the Financial Emergency Measures in Public Interest Act, 2009.
IBEC stated that the Public Sector terms and conditions were applied to ensure that the Hospital was paying in accordance with market rates and stated that the Hospital were currently paying 1% over Public Sector rates.
The Court notes that while the terms and conditions may be broadly in line with the Public Sector, the Hospital receives no public funding and accordingly the payment of redundancy terms is entirely from its own resources and is currently run by NAMA. In all the circumstances of this case the Court recommends that the Hospital should increase its offer to pay one week’s pay per year of service in addition to the statutory redundancy payment, in two phases as outlined above.
The Court so recommends.
Signed on behalf of the Labour Court
Caroline Jenkinson
CR______________________
7th November, 2012Deputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ciaran Roche, Court Secretary.