LCR15580

FULL RECOMMENDATION CD/97/305 RECOMMENDATIONNO.LCR15580 (CC97/761) INDUSTRIAL RELATIONS ACTS, 1946 TO 1990 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : ATLANTIC MILLS (TULLAMORE) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION DIVISION : Chairman: Ms Owens Employer Member: Mr Brennan Worker Member: Mr Rorke

SUBJECT:
1. Improved redundancy terms.





BACKGROUND:

2. The dispute concerns a decision by the Company to cease production in its spinning facility in Tullamore, Co. Offaly with effect from 25th July, 1997, with the loss of 100 jobs. The Company also has a weaving plant in Clondra, Co. Longford which employs 300 workers. The Company was established in 1979. The Union, on behalf of 84 of its members, has served a claim for 6 weeks' pay per year of service plus statutory redundancy. The Company is offering 3 weeks' pay for the first 10 years service and 2 weeks for the balance of service in addition to statutory redundancy. This package has applied since 1991.

The dispute was referred to the Labour Relations Commission and a conciliation conference took place on 16th June, 1997. As the parties did not reach agreement, the dispute was referred to the Labour Court on 17th June, 1997, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on 27th June, 1997.



UNION'S ARGUMENTS:

3. 1. The workers have given long and dedicated service to the Company since 1979. The skills they have acquired over 18 years have now no labour market potential or outlet. Due to the age profile of the workforce, a large percentage will have little or no job prospects. It is expected that the Company will realise significant financial resources from the sale of the plant and machinery. Long-serving workers who, in the past, remained with the Company rather than take redundancy, are now being discriminated against by the Company's offer.



COMPANY'S ARGUMENTS:

4. 1. The Company has, in recent times, come under increasing pressure due to competition from low-labour cost countries and over-capacity in the world denim market. The Company has been unable to find the necessary investment required to keep the Tullamore plant competitive. The Company has had net losses of £2.29 million in 1995 and £2.50 million in 1996, and there have been losses of £1.3 million up to May, 1997. Despite these losses, the Company is prepared to fund the redundancy package at a cost of £1.25 million. If the Company was to pay the Union's claim of 6 weeks' pay per year of service, the cost could put the future of the 300 jobs in the Longford plant at risk.





RECOMMENDATION:

Having considered the submissions from the parties, the Court recommends that the Company increase its offer of redundancy payments to 4 weeks' pay per year of service plus statutory entitlements to all employees who are the subject of the claim.



Signed on behalf of the Labour Court



Evelyn Owens
7th July, 1997______________________
C.O'N./D.T.Chairman



NOTE

Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.