Labour Court Database __________________________________________________________________________________ File Number: CD88595 Case Number: AD8858 Section / Act: S13(9) Parties: KAYFOAM WOOLFSON LIMITED - and - AMALGAMATED TRANSP0RT AND GENERAL WORKERS' UNION |
Appeal by the Union on behalf of two workers against Rights Commissioners Recommendation No. BC 220/88 concerning the level of redundancy.
Recommendation:
8. Having considered the submissions made the Court is of the
opinion that the Rights Commissioners Recommendation should be
amended to provide worker A (service since 1980) with an
additional #475 instead of the #375 as recommended and worker B
(service since 1984) an additional #350 instead of the #250
recommended. The Court so decides.
Division: Mr O'Connell Mr McHenry Mr O'Murchu
Text of Document__________________________________________________________________
CD88595 APPEAL DECISION NO. AD5888
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
SECTION 13(9)
PARTIES: KAYFOAM WOOLFSON LIMITED
(REPRESENTED BY THE FEDERATED UNION OF EMPLOYERS)
and
AMALGAMATED TRANSP0RT AND GENERAL WORKERS' UNION
SUBJECT:
1. Appeal by the Union on behalf of two workers against Rights
Commissioners Recommendation No. BC 220/88 concerning the level of
redundancy.
BACKGROUND:
2. The Company is engaged in the manufacture of polyurethane foam
for the upholstery industry most of which it exports to the U.K..
The foam is used in the manufacture of bedding and ancillary
products including foam filled pillows. In November, 1987 the
Company advised the Union of forthcoming problems in customer
demand for foam filled pillows and in January, 1988 it became
necessary for the Company to lay-off 2 workers in the pillow
section.
3. At a meeting held on 31st May, 1988 to discuss pay and other
issues the question of the lay-offs of the two workers concerned
was raised. The Company advised the Union that as the foam pillow
business had gone completely and as alternative business had not
been developed it seemed likely that the lay-offs would continue
right through 1988 and 1989. The Company, under the
circumstances, recognised the unsatisfactory nature of the lay-off
and indicated it would be willing to consider applications for
voluntary redundancy. The Company offered the following terms.
The worker with service since 1980 - statutory lump sum plus
#2,000. The worker with service since 1984 - statutory lump sum
plus #1,000 inclusive of all claims including minimum notice.
The Union subsequently claimed higher redundancy payments - 4
weeks' pay per year of service plus statutory redundancy lump sum
entitlements.
4. The Company refused to increase its offer and the matter was
referred to a Rights Commissioner for investigation and
recommendation. Following an investigation held on 27th June,
1988 the Rights Commissioner issued the following recommendation
dated 1st July, 1988:-
"In the light of the above, I recommend that the Company's
offer expressed in a letter of 31st May, 1988 should be
improved as follows:-
Worker A (service since 1980) - an additional #375 to be
offered.
Worker B (service since 1984) - an additional #250 to be
offered."
The workers were referred to by name in the Rights Commissioner's
Recommendation.
5. The Union rejected the recommendation and appealed it to the
Labour Court under Section 13(9) of the Industrial Relations Act,
1969. The Court heard the appeal on the 12th September, 1988.
UNION'S ARGUMENTS:
6. 1. The Rights Commissioners recommendation was rejected on
the basis that there was no unanimity on the inevitability of
redundancies as the Union strongly objected and still do to
the selection of the two workers concerned. In fact their
selection for lay-off was the subject of a dispute (LCR No.
11837 refers).
2. The Company's present trading difficulties are of recent
origin and the Union feels that the Rights Commissioner did
not take into account the Company's profitable years and the
future employment prospects of the workers concerned.
3. The Union's claim is a reasonable one based on redundancy
settlements in companies who have experienced difficult
trading positions over a period of years and which have made
similar settlements to the present claim.
4. The claim which would give the workers total payments of
#4,521.40 and #2,322 respectively is well within the
competency of the Company.
COMPANY'S ARGUMENTS:
7. 1. The Company believes that its original offer is fair and
reasonable, especially having regard to the extremely
difficult trading position. It only considered ex gratia
voluntary redundancy on the basis of good industrial relations
and representations from the Union committee. Redundancies
have not previously applied in the Company so there is no
precedent for paying above the statutory amount.
2. The Rights Commissioner's Recommendation to increase the
Company's offer was extremely generous to the employees and
beyond what the Company believes appropriate in the
circumstances.
3. In order to meet the new fire safe foam regulations the
Company has had to make very heavy expenditure in developing
a new fire safe foam to replace conventional foam production.
In addition while trying to develop the new fire safe foam at
very high cost, the Company lost a substantial number of
customers and has not yet regained all of this lost business.
The Company's continued survival was very uncertain for a
period and has only been secured now at very considerable cost
and loss of business.
4. The total fall off in demand for pillows has also
obviously effected the Company's trading position. Pillows
are filled with waste crumbed foam which was the company's
principle method of disposing of conventional waste foam and
this avenue of disposal has now been closed to the Company.
The accumulated stocks of conventional waste foam is not in
compliance with the new fire safe regulations and cannot be
disposed of at commercial prices except when utilised in foam
pillows.
DECISION:
8. Having considered the submissions made the Court is of the
opinion that the Rights Commissioners Recommendation should be
amended to provide worker A (service since 1980) with an
additional #475 instead of the #375 as recommended and worker B
(service since 1984) an additional #350 instead of the #250
recommended. The Court so decides.
~
Signed on behalf of the Labour Court
John O'Connell
______________________
26th September, 1988 Deputy Chairman.
M.D./J.C.