INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
ADT FIRE & SECURITY LTD
(REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
- AND -
TECHNICAL, ENGINEERING AND ELECTRICAL UNION
Chairman: Mr Duffy
Employer Member: Mr Grier
Worker Member: Mr O'Neill
1. Redundancy Terms and Selection Criteria
2. This case concerns a dispute between the Company and Union in relation to Redundancy Terms and Criteria. The Company, which provides electronic security services has offices in Dublin. Cork and Galway. The Company's position is, that due to a downturn in business, it must initiate compulsory redundancies in the different geographical locations. It offered six weeks pay per year of service, inclusive of statutory entitlements, capped at 104 weeks.
The Union's position is that the redundancies should be on a voluntary basis and if not adequately subscribed to, the principal of Last In First Out (L.I..F.O.) should apply.
The dispute was not 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 matter was referred to the Labour Court on 7th November, 2008 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on 9th December, 2008.
3 1The redundancies should be initially on a voluntary basis and only compulsory if necessary. If compulsory, the principles of L.I.F.O. should apply. It is unacceptable that the Company are not applying these long established criteria in its package.
2 Precedents exist both in the Company and the sector for 6 weeks pay per year of service (inclusive of statutory entitlements) uncapped.
4 1 The Company has offered 6 weeks pay per year of service inclusive of statutory entitlements to those affected by the redundancies. The reason for the cap is due to the current financial position of the Company.
2 Much of the Company's business comes from the Construction and Retail sector, both of which are in rapid decline. The Company must retain key skills in order to remain viable into the future. The package on offer reflects the needs of
the business, while at the same time offers generous terms to the workers.
In considering its recommendation in this case the Court has had regard to the most recent redundancy terms applied by the Company. In that regard the Court notes that following Recommendation LCR18957 the Company applied a severance package of four weeks' average earnings per year of service (calculated by disregarding the final thirteen weeks of earnings and taking the average earnings for the previous twenty six weeks) in addition to statutory entitlements. The amount payable was not capped.
In the Court's view there are no compelling arguments for departing from that formula in the present case. Accordingly, the Court recommends that the same package apply in this case without a cap.
With regard to the selection criteria, the Court recommends that the package be offered on a voluntary basis in the first instance, but within the various grades and geographical locations in which redundancies are sought. If there are insufficient volunteers within any grade and /or location selection should be by LIFO.
Signed on behalf of the Labour Court
23rd December 2008______________________
Enquiries concerning this Recommendation should be addressed to Andrew Heavey, Court Secretary.