Labour Court Database
File Number: CD88400
Case Number: AD8845
Section / Act: S13(9)
Parties: BERGER PAINTS (IRELAND) LIMITED - and - SALES, MARKETING AND ADMINISTRATIVE UNION OF IRELAND
Appeal, by the Union, against a Rights Commissioner's Recommendation, No. CW 254/87.
Division: Ms Owens Mr Shiel Ms Ni Mhurchu
Text of Document__________________________________________________________________
CD88400 APPEAL DECISION NO. AD4588
INDUSTRIAL RELATIONS ACTS, 1946 TO 1976
PARTIES: BERGER PAINTS (IRELAND) LIMITED
(REPRESENTED BY THE FEDERATED UNION OF EMPLOYERS)
SALES, MARKETING AND ADMINISTRATIVE UNION OF IRELAND
1. Appeal, by the Union, against a Rights Commissioner's
Recommendation, No. CW 254/87.
2. The Company employs thirteen sales representatives. Their
current salary scale is an eleven point one ranging from £11,126
to £16,111. This scale resulted from the amalgamation of three
scales into two in 1980 and into one in 1981. Eleven of the
thirteen sales representatives are currently on the maximum point
of the scale. Since 1982 the Union has been seeking a revision of
the scale, to include the addition of extra points. In March,
1987 under the 26th wage round a 12 month agreement was reached
which contained a no cost increasing clause with the exception of
the Union's claim for the addition of two points to the top of the
salary scale. No agreement was reached at local level and in
December, 1987 the claim had been referred to a Rights
Commissioner who held an investigation on 4th March, 1988. On
15th March, 1988 the Rights Commissioner issued his Recommendation
which stated as follows:
" Equally meritorious arguments can arise for either
lengthening or shortening salary scales according to
particular circumstances at any given time. Both sides
have produced comparative data supportive of their
respective arguments. Taking both the external
conditions of the market place and the internal
constraints on the Company it seems to me that the time
is inauspicious for any lengthening of the scale at
present, especially as so many (11 out of 13) are on
the current maximum point.
I recommend that the Union and the Sales
Representatives accept that the salary scale remains
unchanged until more favourable conditions emerge. "
The Union appealed this recommendation to the Labour Court under
Section 13(9) of the Industrial Relations Act, 1969. The Court
heard the appeal on 23rd June, 1988.
3. 1. The Rights Commissioner accepted the principle that
adjustments to the salary scales can be justified. However he
considered that in this instance the time was inauspicious,
due in particular to the fact that eleven of the thirteen
workers concerned are on the maximum point of the scale. The
Union believes that had fewer people been on the maximum
point, the recommendation would have been in the Union's
favour. It is considered that the numbers are irrelevant and
that the recommendation is therefore inequitable.
2. The cost of conceding the claim is low (an increment of
£486 per annum to eleven workers for each of two further
years). The scale would still be less than the average number
of points in comparable employments, which is 14. Concession
of the claim could mean that the workers would still be £709
below the average salary in comparable companies (details
3. The Rights Commissioner proposed that the scale should be
changed when more favourable conditions emerged. Since the
time of his investigation sales have shown a substantial
increase and the Company has had an exceptionally good volume
increase. The Union contends that more favourable conditions
have, in fact, emerged.
4. The Union does not accept that concession of this claim
would have any "knock-on" effects.
4. 1. As a result of the current recession and the state of the
construction industry the paint market in Ireland has
contracted by 17% in the past five years. The Company is also
experiencing competition both from domestic and foreign
companies and is finding it increasingly difficult to recover
costs (details supplied). Sales representatives salaries have
increased very substantially over the same period (73.2% since
1981). Costs must be contained and efficiency improved if
survival is to be ensured in an open European market after
2. The total remunerative package of sales representatives is
excellent. They enjoy an attractive bonus scheme in addition
to basic salary. Contributory pension scheme, VHI
contributions of £75 per annum, Company car, garage allowance
of £182.00 per annum and free telephone rental (£134 p.a.).
An Income Continuance Plan is currently being implemented.
The position in relation to basic salary and total
remuneration compares very favourably with that obtaining in
the other two major Irish companies supplying paint to the
retail market (details supplied). The Company does not accept
the comparisons made by the Union.
3. The worldwide Berger Group was taken over in January, 1988
by Williams Holdings PLC. To date the Group activities abroad
have been rationalised and it is inevitable that the Irish
Company will also be subject to close examination with
particular regard to operational and trading costs. Already,
Berger Ireland is out of line in that its costs are
considerably higher than those of the second Williams paint
operation in Ireland. To increase the differentiation at this
or any stage would not be helpful to the Company.
4. Concession of the claim could have serious "knock-on"
effects and would be counter productive in a situation where
the Company's wage costs are in excess of other companies in
5. The Court does not consider that the Company's situation has
altered to an extent that would justify recommending in favour of
the Union's claim.
The Court accordingly upholds the Rights Commissioner's
recommendation and rejects the appeal.
Signed on behalf of the Labour Court.
A. K. / M. F. Deputy Chairman