FULL RECOMMENDATION
INDUSTRIAL RELATIONS ACTS, 1946 TO 2004 SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990 PARTIES : FULFLEX INTERNATIONAL COMPANY (REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION) - AND - SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION TECHNICAL, ENGINEERING AND ELECTRICAL UNION AMICUS DIVISION : Chairman: Mr Duffy Employer Member: Mr Grier Worker Member: Ms Ni Mhurchu |
1. Severance terms on closure.
BACKGROUND:
2. The Company has operated in Ireland, at a facility in Limerick, since 1969. It manufactures rubber elastic products mainly for the European markets. It is wholly owned by The Moore Company of Rhode Island. The Company currently employs 124 people of whom 108 are to lose their jobs as a direct result of the decision taken to relocate the business.
The Board, having decided that all manufacturing at the Limerick plant would cease on the 5th May 2006 decided on severance terms for those employees who would lose their jobs. In reaching its decision the board reviewed its legal obligations, a claim from the SIPTU Union and other severance information requested from local management. The Unions put forward a claim for severance based on an agreed package that had been accepted by both the Company and the Unions in a rationalisation deal in 1988.
The 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 the 25th April, 2006, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 27th April, 2006.
UNION'S ARGUMENTS:
3. 1.The Company's offer is totally inadequate and any proposition involving post closure payments based on the sale of the plant would not be acceptable.
2. In putting forward its offer the Board of Directors have chosen to renege on existing agreements between the Company and the Trade Unions governing redundancy terms.
3.The Company which is a subsidiary of a huge multinational corporation has decided to offer little more than statutory entitlement to workers who in some cases have devoted a life time of service to the Company.
COMPANY'S ARGUMENTS:
4. 1.The redundancy agreement reached in 1988 was in relation to a specific situation and was not a general redundancy agreement for the future.
2. The Company is in a seriously loss making situation and is not in a position to fund any redundancy package. It has to obtain these funds from The Moore Company.
3. The redundancy package can only be funded by the sale of the Limerick factory premises There is no cash available and assets must be liquidated.
RECOMMENDATION:
The Court has given careful consideration to the submissions of the parties to this dispute.
The Court has considered the terms of the offer made by the Company. In the Court's view it is most unusual in terms of its structure and is also out of line, in terms of the amounts which would become payable, with the type of arrangements normally offered in similar situations.
The Court believes that the arrangements which the Company unilaterally applied in a situation of voluntary redundancy in 2000 represent a reasonable basis upon which the current dispute should be resolved. Accordingly, the Court recommends that the Company offer and that the Unions accept a redundancy package of 4 weeks pay per year of service plus statutory entitlements where applicable.
Signed on behalf of the Labour Court
Kevin Duffy
28th April, 2006______________________
MG.Chairman
NOTE
Enquiries concerning this Recommendation should be addressed to Madelon Geoghegan, Court Secretary.