FULL RECOMMENDATION
PARTIES : REHAB ENTERPRISES LIMERICK DIVISION :
SUBJECT: 1.Failure to agree Redundancy Terms in Rehab Enterprises. 2. The Union states the Company is solvent. Any difficulty in meeting the cost of the claim should be addressed by the parent Group as has happened in the past. 2. The Company ask the Court to give due consideration to the inability to pay and the very serious inevitable outcome on the Company as a going concern of any recommendation which would require additional funding.
The first hearing of the Court resulted in a Recommendation (LCR22404) that the Trade Union should avail itself of financial expertise so as to be able to develop a shared understanding with the employer of the limits of the capacity of the funding stream available to the employer to meet the cost of the Trade Union side claim. The funding stream available to the employer has been the Rehab Group. It has been accepted that the employer itself is unable to meet any of the cost of the redundancy of the workers who are party to the claim before the Court. Similarly, it has been established that the Rehab Group, which is the 100% shareholder of the employer, has been able to provide the funding to facilitate the offer of the employer which had been made prior to a referral of the matter to the Court. That offer amounted to a package consisting of statutory entitlement plus two weeks’ pay per year of service capped at one years’ pay. The Trade Union side claim is for payment of redundancy terms amounting to statutory entitlement plus four weeks’ pay per year of service with no cap on the amount to be paid. This formula, according to the Trade Union, has been the collectively agreed terms applicable in the employment. The Trade Union, following the issue of Labour Court Recommendation LCR22404, engaged financial advisers. Those advisers engaged with the employer and the Rehab Group. The report of the advisers affirmed that the employer had no capacity on its own to meet the terms already offered to the workers or to meet the cost of the Trade Union side claim. That report also asserted that the financial advisers had been unable to establish what unencumbered Rehab Group funds and assets may or may not be available to fund the Trade Union’s claim. The Court is of the view that, given that the Rehab Group has provided the employer a capacity to make an offer as set out earlier in this Recommendation, it is reasonable to expect that the Group would enable the Trade Union’s financial advisers to understand the limits of its capacity to meet any further cost associated with the redundancy of the 36 workers who are the subject of the claim before the Court. It is the conclusion of the Court that a collective agreement exists between the parties which makes provision for payment of statutory entitlement plus four weeks’ pay per year of service uncapped on redundancy of a worker. the employer itself is unable to pay these terms, or any redundancy terms including those already offered, to the Claimants in the matter before the Court on their redundancy. there is no shared understanding between the parties as to the capacity of the Rehab Group, which has supported the employer as regards the offer already made to the Claimants, to meet the cost of concession of the Trade Union’s claim. In those circumstances, there is no clarity as to whether the decision to limit the funding available to the employer is a result of inability to pay or unwillingness to pay. The Court recognises that the Rehab Group is not a party to the trade dispute before it. However, as the 100% shareholder of the employer and as the main source of funding in relation to offer already made by the employer to the Trade Union, there is, in the view of the Court, a clear responsibility to assist the 36 workers, through their financial advisers, to understand the factual parameters surrounding their employer’s capacity to secure funding to address their claim arising from their redundancy. For that reason, the Court recommends that the employer should prevail upon the Rehab Group to engage further with the Trade Union’s advisers so as to assist them in making a full report to the Trade Union on the matters identified in the Court’s first Recommendation in this matter (LCR22404). On the assumption that a further engagement by the Trade Union’s financial advisers with the Rehab Group will secure a shared understanding of the factual basis and reasons for any limits on the employer’s capacity to access funding, the Court recommends that the parties then re-engage locally in an effort to achieve agreement in relation to the matters in dispute. In making this Recommendation, the Court notes that the employer, at the hearing of the Court, advanced its offer for settlement to a package consisting of statutory entitlement plus four weeks pay per year of service capped at 18 months’ pay. If a shared understanding cannot be achieved on these matters, the parties should return to the Court for a final and definitive recommendation. The Court so recommends.
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