Procter & Gamble told to pay out ‘bonus’

The Labour Court has recommended that consumer healthcare giant Procter & Gamble (P&G) pay a ‘loyalty’ windfall to its Nenagh-based workforce.

Last year, P&G sold its Nenagh plant to US cosmetics firm Coty, having operated the facility since 1978.

Around 250 staff are employed at the plant and were informed in a staff meeting held in the wake of the sale last year that they would remain as P&G employees until the end of 2016, when the deal is finalised, at which point they will become Coty employees.

Following the announced sale, Siptu lodged a claim for a loyalty payment for its Nenagh-based members. The Labour Court has now recommended that workers at the plant receive a one-off loyalty payment ranging from €5,500 to €12,500 each.

In its argument before the Labour Court, Siptu said P&G is a multinational that could easily afford to make a satisfactory, once-off gratuity to its Nenagh staff to acknowledge their contribution. Siptu was seeking €2,500 per year of service.

P&G said employees’ loyalty has already been rewarded over the years.

It said there is no contractual or statutory entitlement to a one-off loyalty payment for staff in a transfer situation, nor is there a custom, practice, or policy in the history of P&G.

In its recommendation, the Labour Court noted “the profound effect on the workforce of the proposed transfer of ownership of the business”.

It stated that it also noted the need for full co-operation by the workforce to efficiently bring about that transfer.

“Finally, the court notes the precedent established in the 2008/09 downsizing agreement, in which compensation for co-operation with change was conceded by the company.”

The Labour Court stated that in that context and in return for full co-operation with the transfer of the business to the new owners, it was recommending the company pay a range of amounts to affected workers.

It recommended that P&G staff with less than five years’ service receive €5,500; staff with five but less than 15 years’ service receive €8,000; and staff with 15 or more years’ service receive €12,500.

The most recent accounts for P&G (Manufacturing) Ireland Ltd, which also operates a plant in Newbridge, Co Kildare, show that it recorded pre-tax profits of €11.68m last year.