INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
CAHILL MAY ROBERTS
(REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
1. Dispute concerning (i) Redundancy and (ii) New wage scales.
2. Arising from the introduction in the Company's Cavan branch of a new system of stocking and storing product, which has led to increased efficiency, the Company is seeking one redundancy in the area. The Company is also seeking the introduction of new entry rates for recruits (£171 per week).
Existing employees would have their terms/conditions red-circled and would receive a lump-sum of £650 along with improved pension benefits. The Union's position on the issue of redundancy is that the efficiencies achieved would equate to one half of one redundancy. The Union sought full redundancy terms ( 5 weeks' pay per year of service, plus statutory entitlements) for the worker who was to leave, along with that worker's replacement on a part-time basis. The Union rejected the proposal for a reduction in the new entry rate.
The issues were the subject of conciliation conferences under the auspices of the Labour Relations Commission, at which agreement was not reached. The dispute was referred to the Labour Court, on the 15th of January, 1996, in accordance with Section 26(1) of the Industrial Relations Act, 1990. The Court investigated the dispute, in Cavan, on the 29th of May, 1996.
3. (i) REDUNDANCY:
1. The changes made in Cavan were essential to the long-term efficiency and viability of the branch. As a result, assembly rates have improved significantly, 125% performance yields an assembly rate of 197 lines per hour - an increase of 60% in productivity. "Putting away" stock from goods inwards is significantly more convenient and efficient, requiring only two locations per order, both on the ground floor.
2. Decisions regarding redundancy within the Company are the prerogative of management and are, therefore, not negotiable.
3. The strategy of seeking volunteers for redundancy in the first instance is a well accepted one and normally leads to better industrial relations within the Company in the long-term.
4. In this case there are individuals interested in accepting redundancy and the Company is disappointed that this has been blocked by the Union.
(ii) NEW ENTRY RATE:
1. The new rate proposed is the same as the rate enjoyed by existing staff, less the incentive bonus. The Company has reached agreement with SIPTU in relation to the introduction of these new conditions in the Dublin, Sligo, Cork and Limerick branches.
2. In return for agreement, the Company will pay £650 gross to all staff members as compensation. The pension scheme will be enhanced by approximately 40% (details supplied to the Court).
3. The Union's consistent rejection of all the Company's proposals is unreasonable as the package has been accepted in all the Company's other branches.
4. The Company understood that acceptance by the Union of the need to rationalise was given at the initial meeting in January, 1995. However, 15 months later, no progress has been made on the issue.
5. The Court, in LCR 15102 (United Drug), took note of the difficulties facing the pharmaceutical distribution industry and recommended in favour of changes.
4. 1. The Union was prepared to agree to a half a redundancy (details supplied) provided that the worker was made redundant and replaced by a new member of staff who would work the 2.5 days per week spread over 3 days, as required by the Company. This was rejected by the Company.
2. The staff in Cavan are adamant that they cannot impinge on the future earnings or any potential earnings of any new employees.
3. Different wage scales will invariably lead to disputes within the Company and will, ultimately, lead to the Union claiming the higher rate of pay for any new employees who may be recruited in the future.
4. There are anomalies across the country in payment for special lines (details supplied). Workers in some branches are being paid substantial extra money per year for delivering these goods which originate outside the branch.
5. The loss of any further staff would result in an unacceptable increase in work-load for the remaining staff.
6. There will be an increase in late orders being accepted. This will result in drivers experiencing increased difficulty in ensuring that the product reaches the customer.
7. The Company also propose to increase the benefits of the Pension Scheme. However, the Union has already sought an increase in the Pension Benefits in the Company Pension Scheme as per Clause 4 of the PCW.
8. The Company's rationalisation is designed to increase its profit substantially at the expense of jobs and rates of pay of new employees entering the Company.
Having considered all the information before it, the Court recommends that:-
1. The basic rate for new employees be the same as for existing staff but excluding the incentive bonus as agreed in other branches of the Company;
2. The Company proposal for 1 redundancy be accepted by the employees, given the Company commitment to the Court that it would review the position if an unacceptable burden on the staff arose as a result of this reduction.
Signed on behalf of the Labour Court
10th July, 1996______________________
Enquiries concerning this Recommendation should be addressed to Michael Keegan, Court Secretary.