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Labour Court tells SR Technics to fund deficit

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IRELAND - The Labour Court has recommended the Irish arm of SR Technics should "fully fund" the pension deficit in both the SR Technics scheme and the firm's share of the Irish Airlines' Superannuation Scheme.

SR Technics announced in February its intention to close its operation at Dublin Airport, where over 1,000 staff were employed as part of a restructuring exercise, and entered into negotiations with trade unions including the Services, Industrial, Professional and Technical Union (SIPTU).

However, SIPTU referred the matter to the Labour Relations Commission (LRC) last month as SR Technics continued to maintain they could only afford to add one week of extra pay on top of the statutory redundancy entitlement, and would not give any undertakings to meet a reported pension fund shortfall of €26m.

When talks broke down last week, ahead of 600 members of staff being paid off in lieu of notice on 3 April, SIPTU requested the case be prioritised by the Labour Court on the basis that the LRC "was put in an impossible position by the company because management refused to budge on its decision to close or make any move to deal with the pension shortfall or improve the redundancy offer".

The Labour Court issued its recommendations to the parties in the form of a letter because of the "urgency of the matter", and recommended that the "ex gratia element of the package" offered by SR Technics should be increased from £15m to €30m.

It also stated: "The Court recommends that the benefits of both the SR Technics Defined Benefit Scheme and the Irish Airlines' Superannuation Scheme should be fully funded by the company in respect of its employees who are members of the schemes."

The Court said it "urges the parties to accept these recommendations in the interest of bringing closure to the matter", however it has reported SR Technics has argued they cannot afford to fund the pension deficit or increase the redundancy payments.

Pat Ward, branch organiser at SIPTU, said the union was "disappointed but not surprised at the mean-fisted response of SR Technics to the Labour Court recommendation".

He said: "In stating that the company should meet the deficit in the employees' pension funds the Court was doing no more than asking SR Technics to meet its moral and financial obligations to the workers.

"We will be consulting with our members and the other unions at SR Technics immediately to decide the most appropriate strategy in the present circumstances. Every option will be examined and assessed on the basis of its effectiveness to protect the workers' interests," he added.

A spokesperson for SR Technics was unavailable for comment at the time of publication.

If you have any comments you would like to add to this or any other story, contact Nyree Stewart on + 44 (0)20 7261 4618 or email nyree.stewart@ipe.com

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