INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(5), INDUSTRIAL RELATIONS ACT, 1990
- AND -
IRISH AIRLINE PILOTS' ASSOCIATION
1. Pilots' remuneration.
2. On 10th February, 1996 the Tribunal established pursuant to the Agreement of 3rd December, 1990 on the Resolution of Grievances and Disputes between IALPA and Aer Lingus convened. The Tribunal had been requested by IALPA to examine pilots' remuneration with particular reference to the concept of 'drift' i.e., salary growth of one group when compared to another.
The reference by IALPA had been made in the context of certain findings and recitals in a recommendation of a previous Tribunal convened under the Chairmanship of Mr. Justice Geoghan which issued a report on pilots' pay in June, 1992.
The meeting of 10th February, was adjourned and re-convened on four further occasions in the period February/March, 1996.
On 26th June, 1996 the majority Report of the Tribunal was presented to the parties. It recommended as follows:-
(1) A 5% increase from 1st October, 1996.
(2) A 5% increase from 1st July, 1997.
(3) A 7% increase from 1st May, 1998.
The Company rejected the recommendation. Management claims that the Tribunal did not give proper consideration to all the relevant facts before it. IALPA sought the implementation of the Tribunal's recommendation. Local level discussions took place. As agreement could not be reached IALPA served the Company with strike notice to commence at 12 midnight on 22nd September, 1996.
Arising from the impasse reached in the dispute between the parties, and considering the exceptional circumstances of the case, the Labour Court invited the parties to attend an investigation under Section 26(5) of the Industrial Relations Act, 1990. The Labour Court investigated the matter on 21st and 22nd September, 1996. A recommendation was issued by letter on 22nd September, 1996.
4. 1. Management's non-acceptance of a mutually agreed pay review which involved exhaustive examination and negotiation in unacceptable. While the final recommendation did not meet all of the pilots' expectations, the recommendation was accepted because of the pilots' commitment to the process which was carried out over a period of 6 years.
2. The Tribunal has acknowledged that the pilots' pay has been affected by drift and that the pilots have made a case on drift in that the various comparisons invoked by IALPA confirm significant disparities.
3. The pilots' pay is substantially out of line with pilots employed with other European airlines.
4. The dedication and commitment and productivity levels of Aer Lingus pilots are at least equal to the best. In the circumstances the recommendation of the Tribunal is justified and should be implemented.
3. 1. The Tribunal majority failed to take adequate account of the financial effect on Aer Lingus of its recommendation, having regard to the likely effect of the implementation of the recommendation upon wage claims of other Aer Lingus employees.
2. Management was obliged to reject the majority recommendation because of the disastrous consequences for the Company of its implementation. An increase of 17% would lead to certain bankruptcy.
3. The Company acknowledge that there are problems with elements of pilots' pay and is prepared to address those in an affordable and realistic way.
4. Having particular regard for the financial and commercial circumstances of the Company and the requirements necessary to secure its long-term viability the Court is requested to recommend in favour of the Company's rejection of the majority report and recommend IALPA's participation in direct and immediate negotiation with the Company on the legitimate pay aspirations of its members.
The Court has considered the written and oral submissions of the parties to this dispute, which has already been processed fully through all the agreed procedures, up to and including the non-binding majority findings of an independent Tribunal. In this situation the Court finds that the pilots have a strong case for the implementation of the Tribunal findings.
The Company made a detailed and comprehensive presentation to the Court on the serious financial implications of implementing the findings of the Tribunal. The delegation from IALPA chose to absent themselves from this part of the hearing. The Court also notes that the Chairman of the Tribunal stated in a covering letter with the majority report that a document from an independent outside company was submitted after the conclusion of the Tribunal hearings. This was accordingly not considered in the preparation of the majority report.
In the time available to the Court it has not been possible to evaluate in full the extensive evidence on the financial impact of implementing the award. The Court, however, cannot ignore the alarming scenario outlined in the financial figures presented.
The Court accepts that there are particular circumstances pertaining to the pilots' claim which would not necessarily apply to other groups.
In an effort to meet the expectations of the pilots and the commercial objectives of the Company the Court recommends as follows:-
(1) The Company agree to pay phase one (5%) of the Tribunal’s recommendation from the date proposed.
(2) IALPA withdraw strike notice due to expire at midnight.
(3) The Court considers that the future viability of the Company must be of paramount importance to all the parties involved. The Court accordingly recommends that the parties meet immediately to discuss and agree terms of reference for the appointment of an outside expert to examine and report on the future viability of the Company in the context of the full implementation of the Tribunal findings. The terms of reference should include an investigation into the effect of productivity changes, agreedby IALPA,without compensation during the course of the extended negotiations on their claim (items in the Cahill Plan to be excluded). The Court cites as an example the reduced manning arrangements on the Atlantic Airbus. An examination of possible future productivity measures should also be included.
The Court notes that the Company accept that there is a requirement to address the pay levels of junior pilots. This matter should also be included in the investigation.
The parties may consider it advantageous to consider the manner in which the total pay package is made up.
The Court urges both parties to accept the above recommendation as a step to resolving the pilots' pay problem and avoiding a catastrophic strike which would be very damaging to both the participants and the Company.
Signed on behalf of the Labour Court
24th October, 1996______________________
Enquiries concerning this Recommendation should be addressed to Fran Brennan, Court Secretary.