LCR22474

FULL RECOMMENDATION

SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990

PARTIES :

SMURFIT KAPPA
(REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)

- AND -

120 GENERAL OPERATIVES
(REPRESENTED BY SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION)

DIVISION :

SUBJECT:

1. Pay Claim

BACKGROUND:

2. This dispute could not be resolved at local level and was the subject of Conciliation Conferences under the auspices of the Workplace Relations Commission. As agreement was not reached, the dispute was referred to the Labour Court on 16 August, 2021 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on 4 October 2021.

UNION’S ARGUMENTS:

3. 1. Smurfit Kappa is a profitable company and has paid a significant dividend to shareholders in February 2021.

2. The Union says that the commitment shown by staff working through the pandemic added to the company profits and it wants its' members, as stakeholders, recognised in a similar way.

3. The Union does not believe that the employees should be asked to trade hard-earned benefits in order to achieve a modest pay increase.

EMPLOYER'S ARGUMENTS:

4. 1. The Company is a long-term employer in Dublin and provides stable employment with excellent terms and conditions within a highly competitive industry.

2. The Company acknowledges the efforts of staff over the past 12 month and is proposing a three year pay agreement.

3. The Company has engaged fully with local and external conciliation processes and has moved considerably from its original position.

RECOMMENDATION :

The Court has given very careful consideration to the written and oral submissions of the parties.

Whereas significant engagement has taken place between the parties, it appears to the Court that little shared understanding of the meaning in practice of a proposal for cost offsetting measures has been achieved. For example, it appears that the money value of the ‘cost offsetting’ proposal tabled by the employer was not the subject of discussion locally or at conciliation and the level of, for example, the proposed reduction in canteen subsidy was not established between the parties.

It appears that, in fact, the rejection by the trade union of the ‘cost offsetting’ proposition underpinning the employer’s last offer of a pay increase was based on a principle rather than any full understanding of the practical effect of the proposal.

The result of this dimension of the parties’ dispute is that the Court itself is not confident that it fully understands the practical meaning or effect on workers of proposed cost offsetting measures; and this lack of clarity inhibits the Court in making a definitive Recommendation incorporating a concession of such proposals.

The Court notes that the Trade Union has rejected a proposal made by the employer for pay increases over each of the three years 2021, 2022 and 2023 and has instead submitted that any agreement should extend at most to the end of 2022. The employer on the other hand submits that any agreement on pay should extend to the end of 2023.

Having regard to all of the circumstances and background to this dispute, including the fact that the first offer made by the employer to resolve this dispute was a two-year proposal extending only to the end of 2022, the Court recommends as follows:

2021 – pay increase of 1.5%

2022 – pay increase of 1.75%.

The agreement to include:

A continued commitment and positive engagement between the parties on admin and operational issues

Continued flexibility and support of ongoing change

No cost increasing claims for the duration of the agreement.

Local bonus discussions will continue to be facilitated on the understanding that implementation of any agreement which might be achieved to alter current bonus arrangements will fall to be negotiated as part of any engagement on a successor pay agreement.

The Court so recommends.

NOTE

Enquiries concerning this Recommendation should be addressed to Ceola Cronin, Court Secretary.