FULL RECOMMENDATION
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : SHOE ZONE - AND - MANDATE DIVISION : Chairman: Mr Haugh Employer Member: Ms Doyle Worker Member: Mr Hall |
1. Redundancy terms.
BACKGROUND:
2. This dispute relates to the level of ex-gratia redundancy to be paid to its staff formerly employed at the Blanchchardstown store.
- This dispute could not be resolved at local level and was the subject of a Conciliation Conference under the auspices of the Workplace Relations Commission. As agreement was not reached, the dispute was referred to the Labour Court on the 20 October 2017 in accordance with Section 26(1) of the Industrial Relations Act, 1990.
A Labour Court hearing took place on the 17 January 2018.
UNION’S ARGUMENTS:
3. 1. The Union argues that the Blanchardstown store is a special case as the lease was due to expire in 2021 but the Company was selling the lease and therefore it argues that it must have been financially beneficial to the Company.
2. The staff members in Blanchardstown were all long serving staff and that they have not received a pay increase since 2012 due to a unilateral pay freeze that had not been agreed.
3. The Union believes that this agreement that they are seeking for their members should be red-circled and they say that the Company should share some of the benefits that the Union says the Company has received as a result of the buyout.
EMPLOYER'S ARGUMENTS:
4. 1. The Company says that the Blanchardstown store is not a unique situation and that there is an agreed redundancy package currently in place arising from a Labour Court recommendation in 2012.
2. There are 30 stores that are loss making in the Company and there are only two of these stores that are worse loss makers than Blanchardstown.
3. The Company contends that the red-circled agreement being sought by the Union is unrealistic and not consistent with previous store closures eight of which were closed in the Republic of Ireland.
RECOMMENDATION:
The dispute relates to the level of ex-gratia redundancy to be paid to its staff formerly employed at its Blanchardstown store. The store closed in December 2017 following a protracted period of discussions between the Company, the affected Workers and the Union. It is not disputed that the store was loss-making.
The Company has consistently applied the following formula in previous redundancy situations: statutory plus one week for each full year of service. This formula was recommended by this Court in Recommendation No. LCR20375 dated 2 October 2012. In the period since that Recommendation issued, the Company has closed seven stores in Ireland and accepted two requests for voluntary redundancy from two senior staff members in its Tallaght store.
The Union submits that the circumstances in which the Blanchardstown store was closed are unique and differentiate that closure from previous store closures. It submits that the Company negotiated an early exit from its lease arrangement from which it benefitted financially. In all of the circumstances, therefore, it further submits, the workers affected by this particular closure should benefit from the financial gains made by the Company and should receive a redundancy package of statutory plus two weeks’ pay per full year of service.
The Company accepts that it negotiated an early exit from its lease arrangement with its landlord in Blanchardstown but submits that it never revealed the financial implications of its early release as it is bound by a confidentiality agreement. It further submits that previous store closures have occurred in similar circumstances and, therefore, does not accept that the closure of the Blanchardstown store is any way unique, as claimed by the Union. A number of the Company’s stores in Ireland (and elsewhere) are loss-making with the result that it plans further store closures in 2018. Finally, the company submits that it cannot afford to improve on the established ex-gratia package, even on a once-off basis on this occasion.
Discussion and Recommendation
The Union has not made out a convincing case as to why the Company, on this occasion, should increase the level of ex-gratia payment it has consistently paid in redundancy situations since 2012. The Court accepts the Company’s submissions with regard to the losses that have accrued to date in a significant number of its stores both in Ireland and the United Kingdom.
Having regard to the Parties’ submissions, therefore, the Court finds that the Union’s claim fails.
The Court so recommends.
Signed on behalf of the Labour Court
Alan Haugh
9th February, 2018.______________________
CCDeputy Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Ceola Cronin, Court Secretary.