INDUSTRIAL RELATIONS ACTS, 1946 TO 2001
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
(REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
Chairman: Mr Duffy
Employer Member: Mr Keogh
Worker Member: Ms Ni Mhurchu
1. Redundancies (Terms).
2. The Company was established in 1974 and is part of the Braun Gmbh group which is a subsidiary of The Gillette Company of Boston, USA. The Company currently employ 780 employees. The Company produces high quality hair care appliances and a range of refill consumables for the Braun dry shaving and medical device business for sale in markets worldwide.
In August 2002 the Company advised the Union of 225 proposed redundancies involving 135 permanent employees and 90 temporary employees. The majority of the redundancies will occur amongst Grade 4 - assembly/production workers. The criteria given for the job reductions was last in first out. Discussion took place locally but no agreement could be reached. The matter was the subject of a conciliation conference under the auspices of the Labour Relations Commission but no agreement was reached.
The matter was referred to the Labour Court under section 26 (1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 31st October 2002 in Carlow.
3. 1. The Union insist on a package which will give workers adequate compensation for the loss of their jobs to other economies.The Company is extremely profitable.
2. Workers are co-operating with the introduction of automated production lines.
3. Workers who will lose their jobs now are production/assembly workers , many of whom have given all their working life with the Company and will find it difficult to find alternative employment.
4. The Company has an obligation to provide redundancy terms at a level which are comparable with the best achievable in this country.
4. 1. The Company is faced with very difficult challenges to attract new investment for strategic core products into the Carlow factory. There is intense internal competition between the global manufacturing sites of Braun GmbH for future investment.
2. The potential cost of the redundancy package to the Company is approximately 5 million euro. This cost is five times more than the cost incurred if the current Company and Union agreement for redundancy - last in first out, was implemented.
3. The severance terms on offer are favourable and in line with norms.
4. The 'Investment' by the company in agreeing to a voluntary programme is huge, and it is reasonable for the company to place some limit on its financial exposure through the mechanism of a ceiling.
The Court accepts that the proposed redundancies are part of a restructuring programme and the current dispute can only be resolved in the context of an overall package including the restructuring proposals.
The Court considers that the offer made by the Company on redundancy terms, including the proposed cap on the amount payable to any individual, is not unreasonable or out of line with normal standards for voluntary redundancies. However, the Court has had regard to all the circumstances of the present case, including the need to obtain agreement, not only on redundancy terms but also on the significant restructuring proposals. The Court recommends that in a final attempt to obtain agreement the cap should continue to apply at the equivalent of two years pay but that the statutory element of the proposed package should not be taken into account for the purpose of applying this cap.
The Court makes this recommendation on the basis of the circumstances which apply in this case. It is not intended as a precedent for any future redundancies in the Company or elsewhere, and should not be quoted or relied upon in any other case.
Signed on behalf of the Labour Court
15th, November, 2002______________________
Enquiries concerning this Recommendation should be addressed to Helena McDermott, Court Secretary.