LCR22329

1.Calculation Methodology in Relation to Voluntary Redundancy Terms.

BACKGROUND:

2.This dispute refers to The Calculation Methodology in Relation to Voluntary Redundancy Terms. 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 30th November 2020 in accordance with Section 26(1) of the Industrial Relations Act, 1990.

A Labour Court hearing took place in a Virtual Court room on the 16th December 2020.

UNION’S ARGUMENTS:

3. 1.The Union contends that the 2019 calculation of a basic week’s pay is the correct calculation arising from the agreement on redundancy terms which is in place since 2004.
2. The Union contends that reserve hours should be included in the calculation of a basic week's pay.


EMPLOYER'S ARGUMENTS:

4. 1.The Employer contends that the 2019 calculation resulted from ‘human error’ whereas the correct application of the 2004 terms is that which was implemented in the case of 15 other redundancies since 2007.

2.Given the exceptional levels of ex-gratia severance payment involved, any further enhancements to the application of the ex-gratia redundancy terms as set out by the Company, would jeopardise the future of doing business in Ireland.






RECOMMENDATION:

The Court has given very careful consideration to the extensive written and oral submissions of the parties.

The matter before the Court relates to dispute as regards calculation of the agreed terms to apply in a voluntary redundancy situation. In that context the Court notes that any redundancy which might occur in any situation to which the terms apply is voluntary in nature.

The Court notes that 15 voluntary redundancies occurred between 2007 and 2018 in the group before the Court. In the case of each of those redundancies, reserve hours were not included in the calculation of a basic week’s pay. In 2019 one redundancy occurred in relation to which reserve hours were included in the calculation of a basic week’s pay.

The Trade Union contends that the 2019 calculation of a basic week’s pay is the correct calculation arising from the agreement on redundancy terms which is in place since 2004. Alternatively, the Trade Union contends that the 2019 calculation sets a new precedent. The employer contends that the 2019 calculation resulted from ‘human error’ whereas the correct application of the 2004 terms is that which was implemented in the case of 15 other redundancies across the period.

The Court notes that no new agreement has been concluded since 2004 governing the calculation of a basic week’s pay. The Court also notes that a 2007 guidance on the calculation of a basic week’s pay for voluntary redundancy purposes specified that reserve hours would not be included in the calculation.

The Court notes that, since 2004, only one example of calculation of a basic week’s pay to include reserve hours has taken place. In all other cases the calculation excluded reserve hours. The Court has regard to the collective agreements of the parties and in that regard must take account of the manner of implementation of such agreements when asked to interpret such agreements by the parties to the agreement itself.

In all of the circumstances, the Court concludes that the correct interpretation of the parties’ 2004 agreement is that reserve hours are not included in the calculation of a basic week’s pay for voluntary redundancy purposes. The Court recommends that this interpretation should be accepted by the parties.

The Court notes that, in the context of the current round of voluntary redundancies, the Company made an offer on 4^thDecember 2020 in an effort to resolve the dispute now before the Court. The Court recommends that this offer should be maintained by the Company and accepted by the Trade Union.

The Court so recommends.

	Signed on behalf of the Labour Court
	Kevin Foley
CO'R	______________________
23 December 2020	Chairman