CD/13/482
RECOMMENDATION NO. LCR20682
(CCC-133194-13)
INDUSTRIAL RELATIONS ACTS, 1946 TO 2012
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
PARTIES :
MSD SCHERING PLOUGH (AVONDALE) LTD
(REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
TECHNICAL, ENGINEERING AND ELECTRICAL UNION
DIVISION :
Chairman : Mr Duffy
Employer Member : Ms Doyle
Worker Member : Ms Tanham
SUBJECT
:
1. Redundancy Terms
BACKGROUND:
2. This case concerns a dispute between the Company and Unions in relation to a claim for enhanced redundancy terms. The Unions are seeking that the redundancy terms be enhanced as follows: a) an increase in the cap on redundancy terms from 2 years to 2.5 years, b) an increase in the weekly statutory cap from €600 to €900, c) €30,000 compensation for those affected by the cap, d) the inclusion of the 5% guaranteed bonus in calculating reckonable earnings and e) a compensatory payment for those being made redundant out of sequence of seniority equating to 75% of notional earnings had seniority applied to their redundancies.
Management is offering six weeks reckonable pay (basic inclusive of contractual overtime, shift hand-over pay and shift premium) per year of service plus one week's additional pay capped at two years' pay. An additional 10 weeks pay is also being applied to those affected by the cap. The terms on offer also include payment of the annual 5% bonus due to those in employment on 1st December and pro rata payments to others, Payment in lieu of notice, KPI site bonus, Payment of Annual Incentive Program (AIP) and payments of VHI premia, Death in Service Benefit and the provision of a training allowance.
The dispute was not resolved at local level and was the subject of a number of conciliation conferences under the auspices of the Labour Relations Commission. As agreement was not reached the matter was referred to the Labour Court on 4th November 2013 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 13th December 2013.
UNIONS ARGUMENT:
3 1 The redundancy terms being offered by the Company are wholly inadequate. Unlike previous redundancies within the Company the workers in this case are being made redundant on a compulsory basis. Given that the wider group is extremely profitable and that production from the Rathdrum site is being transferred to other Company locations, the enhancements on the redundancy terms sought by the Unions are fair and reasonable in the circumstances.
COMPANY'S ARGUMENT:
4 1 The offer put forward by the Company is extremely generous and is in line with industry norms. There are significant additional payments being made to the workers to take account of their long service and contribution to the Company over many years. In the circumstances the Company does not consider it appropriate to enhance the terms on offer in line with the Unions claim.
RECOMMENDATION
:
The Court has carefully considered the submissions of the parties to this dispute. The Court has also examined the proposal put forward on redundancy terms by the Company.
In the Court’s opinion the proposed terms are reasonable by any objective standard and in particular by reference to redundancy terms applied in similar employments. They are also in line with, and in some respects superior to, terms previously applied by this Company.
The Unions have made the point that while similar terms were previously applied on this site the redundancies to which they relate (in Rathdrum) were voluntary. They pointed out that the redundancies now in contemplation arise from a complete closure of the plant and are all compulsory. On that account they contend that there is justification for a further enhancement of the terms in this instance. Notwithstanding its conclusions on the reasonableness of the proposed terms overall the Court does accept that there is cogency in that line of argument.
The Court believes that in the circumstances of this particular case there is justification for some modification of the Company’s proposal as they apply to employee with long service. Accordingly, the Court recommends that the long service premium for those with more than 17.33 years’ service should be increased from 10weeks reckonable pay to 15 weeks reckonable pay. The Court does not recommend any other changes in the terms proposed.
In making this recommendation the Court wishes to point out that it relates to the circumstances on the Rathdrum plant and is not intended to have wider application or any precedent value in any other case.
Signed on behalf of the Labour Court
Kevin Duffy
10th January 2014
______________________
AH Chairman
NOTE
Enquiries concerning this Recommendation should be in writing and addressed to Andrew Heavey, Court Secretary.
-------------------------------------------------------------------------------------------------
Edit History:Rev. Editor Edit Date
8. Andrew Heavey/entemp 10/01/2014 14:32:30
7. Andrew Heavey/entemp 10/01/2014 14:12:20
6. Andrew Heavey/entemp 10/01/2014 14:11:30
5. Andrew Heavey/entemp 10/01/2014 10:15:45
* Only past five edits are shown
-------------------------------------------------------------------------------------------------