FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : GERNORD LTD (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - A GROUP OF WORKERS DIVISION : Chairman: Ms Jenkinson Employer Member: Mr Murphy Worker Member: Ms Ni Mhurchu |
1. Closure of Defined Benefit Pension Scheme.
BACKGROUND:
2. This case concerns a dispute between the Company and members of its managerial staff in relation to changes to the Company Pension Scheme. The Company contends that it must close the Defined Benefit (DB) Scheme and introduce a Defined Contribution (DC) Scheme on the basis of deficits and increased funding costs in the DB Scheme and the need to remain viable and protect employment into the future. The staff in question accept the ongoing difficulties in relation to continuing the Defined Benefit Scheme. The staff are seeking compensation for the loss of the DB Scheme and increased employer contributions to the DC Scheme. The dispute was not 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 matter was referred to the Labour Court on 19th October 2012 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on 1st February. 2013.
WORKERS' ARGUMENT:
3 1The workers involved in this dispute accept that the DB Scheme is not sustainable going forward. However, significant losses will be incurred as a result which should be compensated for. In addition the proposed level of employer contributions to the DC Scheme are wholly inadequate and should be significantly increased.
COMPANY'S ARGUMENTS:
4 1 The Company has attempted to address the concerns of the workers in relation to the issues in dispute. It has put forward proposals which it considers appropriate to resolve the matters in dispute between the parties.
RECOMMENDATION:
The issue before the Court concerns a claim by members of management regarding the Company’s proposals on the closure of its Defined Benefit Pension Scheme and the introduction of a new Defined Contribution Scheme.
The Company outlined for the Court the commercial and financial circumstances of its business which gave rise to the necessity to close the Defined Benefit Pension Scheme. The Claimants accepted that the Defined Benefit Pension Scheme was not sustainable into the future and sought an improvement on the Company’s offer in respect of the new Defined Contribution Scheme. Following detailed engagement with the Claimants the Company improved its offer and presented its final proposals in April 2012, details outlined at Appendix 8 of its Submission to the Court.
Having considered the submissions of both sides the Court is of the view that, in all the circumstances of this case, the Company’s proposals contained at Appendix 8 of its Submission to the Court are fair and reasonable and accordingly recommends in favour of their acceptance by the Claimants involved in the claim.
Furthermore, the Court recommends that in the event that the Company’s commercial and financial situation improves in the future, the Defined Contribution Pension Scheme should be jointly reviewed.
The Court so recommends.
Signed on behalf of the Labour Court
Caroline Jenkinson
22nd February 2013______________________
AHDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Andrew Heavey, Court Secretary.