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2002

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LCR17265

FULL RECOMMENDATION

CD/01/635
RECOMMENDATIONNO.LCR17265
(CC01/3425)
INDUSTRIAL RELATIONS ACTS, 1946 TO 2001
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990



PARTIES :
IRISH FERRIES

- AND -

SEAMEN'S UNION OF IRELAND


DIVISION :

Chairman: Ms Jenkinson
Employer Member: Mr Carberry
Worker Member: Ms Ni Mhurchu
SUBJECT:
1. Lump sum payments


BACKGROUND:

2. The case concerns a dispute between the union and management over a lump sum payment to deck ratings. It had been agreed between the parties that deck ratings would undertake a new function of on-board "lashing" on the car ferry. The Company agreed to pay a lump sum of £12,000 to each rating in two phases of £10,000 and £2,000.

The Union claims that the former HR Director had given an assurance that two thirds of the payment would be taxed at a favourable rate. However, no such tax exemption applied to the payment and states that the company should now compensate the workers for this shortfall.




Management rejected theUnion's claim. It stated that it proposed to enter discussions on a new productivity deal as a means of settling the claim.

As agreement was not possible the dispute was referred to the Labour Relations Commission. A conciliation conference was held on the 2nd November, 2001 but no agreement was reached. The dispute was referred to the Labour Court on the 6th November, 2001. The Court investigated the dispute on the 13th September, 2002(the earliest date suitable to the parties).


UNION'S ARGUMENTS:

3. 1. The claimants were led to believe that two thirds of the lump sum was tax free. However, no such tax break existed.

2. The Company should compensate the workers for the shortfall.

3. The staff voted on a package that was put to the union by the company. Management should keep their side of the bargain.

4. The union would ask the Court to find in its favour on behalf of the deck ratings.

COMPANY'S ARGUMENTS:

4. 1. An individual's tax liabilities are not a matter for the company.

2. The company cannot accept that the previous HR Director would have given the assurance as claimed by the union.

3. Any concession of the claim would have repercussive effects for the company.

4. The company remains available to negotiate an alternative productivity deal as a way of settling the claim.

RECOMMENDATION:

The case before the Court concerns the tax status of a lump sum paid as a resolution to a dispute concerning "lashing". The claimants concerned were under an expectation that the lump sum would be subject to certain tax relief, which transpired not to be the case. A proposal was put to the claimants on 13th of February, 2002, which formed the basis of a settlement of this dispute. However, due to subsequent difficulties with another party, the Company withdrew this proposal.

The Company now proposes to enter into negotiations on an alternative genuine productivity deal. The Court recommends that this suggestion should be availed of by the Union as a means of resolving this dispute.







Signed on behalf of the Labour Court



Caroline Jenkinson
17th September, 2002______________________
LW/MB.Deputy Chairman



NOTE

Enquiries concerning this Recommendation should be addressed to Larry Wisely, Court Secretary.




 
 
 
 
 
 
 
 
 

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