Labour Court Database
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File Number: CD86670
Case Number: LCR10793
Section / Act: S67
Parties: LEO LABORATORIES LTD - and - FWUI
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Subject:
Claim on behalf of 4 workers for a buy-out of overtime.
Recommendation:
5. The Court, having considered the submissions made by the
parties, recommends that in the exceptional circumstances of this
case, compensation to the amount of 1.50 times the annual estimated
loss should be paid to the claimants.
Division: Mr Fitzgerald Mr Shiel Mr Devine
Text of Document__________________________________________________________________
CD86670 THE LABOUR COURT LCR10793
CC861133 INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
RECOMMENDATION NO. LCR10793
Parties: LEO LABORATORIES LIMITED
(Represented by the Federated Union of Employers)
and
FEDERATED WORKERS UNION OF IRELAND
Subject:
1. Claim on behalf of 4 workers for a buy-out of overtime.
Background:
2. The workers concerned have been working high levels of overtime
for 6, 10, 12 and 13 years. Following the transfer of work
previously done in Ireland to a French branch of the Company this
overtime ceased with effect from early June 1986. The Union, on
behalf of the workers, served a claim on the Company for 3.50 times
the annual loss which was later reduced to 2.50 times the annual
loss. The Company was prepared to offer a compensation formula
which amounted to a payment equal to the annual loss less a sum
equal to the estimated remaining annual overtime. Agreement could
not be reached at local level, and on 2 July, 1986, the matter was
referred to the conciliation service of the Labour Court. A
conciliation conference took place on 18 August, 1986. Agreement
was not reached, and accordingly the matter was referred to the
Labour Court for investigation and recommendation on 19 August,
1986. A Court hearing took place on 26 September, 1986.
Union's arguments:
3. (i) The workers have enjoyed the level of earnings and
standard of living associated with this overtime over
many years and adjustment to seriously reduced incomes
will be difficult.
(ii) The loss of overtime has not resulted from market
conditions, but rather from a transfer of production
within the group. Accordingly, the workers should not
suffer in any way as a result of this corporate
decision.
(iii) No precedent for such a loss of overtime resulting from
a corporate decision of this nature exists in the
plant. Consequently, other overtime buy-out agreements
have limited relevance. None of those affected by
previous buy-out agreements had enjoyed the standard of
living conferred by that overtime for more than three
years. The workers concerned have enjoyed it for up to
13 years.
(iv) There are a number of settlements which provide for
compensation in excess of 52 weeks in buy-outs of this
nature, and this demonstrates that the Union's claim is
not out of line with what may be expected from good
employments (details with Court).
(v) The workers have co-operated fully with the transfer of
the work to France, and have already surrendered the
overtime since last May.
Company's arguments:
4. (a) Where compensation for loss of overtime has been agreed
between the Company and the Union in the past the
maximum compensation available under such agreements
has been one year's loss of overtime calculated at
current rates.
(b) As recently as July 1986, the Union negotiated a
settlement for compensation for loss of overtime in
respect of four laboratory technicians which was
similar in all respects to the agreed formula and the
Company's final offer in the present case (details with
Court).
(c) A settlement in excess of the agreed formula and the
Company's final offer would result in follow on claims
for parity of compensation from those whose claims have
been recently settled, and would have significant cost
implications in respect of any future claims.
(d) The Company is currently suffering from a loss of cost
competitiveness in international markets due to a
variety of reasons. An excessive settlement of this
claim would exacerbate an already difficult situation.
RECOMMENDATION:
5. The Court, having considered the submissions made by the
parties, recommends that in the exceptional circumstances of this
case, compensation to the amount of 1.50 times the annual estimated
loss should be paid to the claimants.
~
Signed on behalf of the Labour Court
Nicholas Fitzgerald
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3rd November, 1986
P.F./U Deputy Chairman