INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
CAHILL, MAY, ROBERTS LIMITED
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
Chairman: Mr Flood
Employer Member: Mr Pierce
Worker Member: Mr O'Neill
1. (1) Guaranteed hours per week (2) Special compensation for loss of guaranteed earnings (3) Fork lift truck differential (4) Seniority.
2. Cahill May Roberts is a wholly owned Company of the German based GEHE Group. It operates out of 6 branches at various locations throughout the country. During the past 12 months negotiations have taken place at national level in relation to the Company's rationalisation/restructuring proposals. As part of its plan the Company is seeking a reduction in the number of branches from 6 to 3 with the loss of approximately 72 jobs.
The dispute before the Court concerns workers employed in the Company's Dublin branch located in Chapelizod. The issues in dispute are:-
(1) guaranteed hours per week;
(2) special compensation for loss of guaranteed earnings;
(3) fork lift truck differential;
Under the proposed new manning arrangements for Chapelizod there would be 22 full-time permanent employees supplemented by part-time employees to cover peak periods. Some of the issues which arise from the proposed re-organisation are common to all branches while others are common to Chapelizod. The particular difficulties in the case of Chapelizod stem from local agreements and in particular a 1994 agreement which gives a red-circled group of 30 employees certain guaranteed levels of earnings. The Company
is seeking to buy out these arrangements and to remove all the red-circled payments, pay compensation and move forward on the basis of an increased hourly rate. The Company's position in relation to the items in dispute are as follows:-
(1) Guaranteed hours per week:
A basic rate of £6 per hour and a guarantee of 9.25 hours overtime per week payable at double time. This would give a guarantee of £17,800 per annum. As part of this arrangement drivers would work 5 hours every second Saturday and warehouse employees would work 4 hours every third Saturday.
(2) Special compensation for loss of guaranteed earnings:
From the date of the introduction of the new agreement, each employee's remaining years of service will be calculated to the date of normal retirement, 20% of this figure will be the factor used to determine the amount of compensation up to a maximum of £14,OOO.
(3) Forklift Truck differential:
All employees expected to be multi-skilled in that there will be only one job category, i.e. warehouse operative. The Company is committed to providing the training for employees currently not trained to drive fork-lifts.
The Company is not opposed to the concept of seniority within its workforce. It recognises and will continue to recognise seniority in the legal and generally accepted areas of recognition. In addition it rewards seniority through additional service pay and additional holiday entitlements. The Company's problems arise when the workforce use seniority for preference in the selection for specific jobs, selection for overtime and the selection of van runs which creates an inflexible operation and an inability to respond to customer requirements. The situation becomes more critical in times of absenteeism and holidays when employees demand the choice of jobs on a day to day, hour to hour basis.
The matter was referred to the Labour Relations Commission. A number of conciliation conferences took place. As agreement could not be reached the dispute was referred to the Labour Court on the 6th of October, 1997 under Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 16th of October, 1997.
3. 1. The guarantees received in 1994 formed part of an overall agreement, in which the workers agreed flexibility, the separation of the warehouse into two sections, the employment of part-time staff and the employment of new staff at a lower rate of pay.
2. The workers will not freely surrender these guarantees. If the workers are to re-consider their stance a more attractive offer must be made. Any compensation agreed would have to be paid at the commencement of any new agreement.
3. The workers are prepared through negotiation to relinquish their life-time guarantees in return for other similar life-time guarantees provided that the Company is prepared to pay compensation based on the projected losses involving each individual up to the date of normal retirement from the Company.
4. It is the Union's view that all 22 jobs should be claimed based on seniority in the first instance and at intervals of 6 months thereafter.
5. The Company's proposal to do away with the fork-lift differential and allow all staff operate the fork-lifts did not operate successfully in the past. The Company proposes to introduce narrower aisles and higher stacking in the new operation. In the circumstances safety demands that the current situation is maintained.
6. Any agreement reached will have to be on the basis of trading one life-time guarantee for another life-time guarantee. The Company's offer to replace the current guarantee with a ten year guarantee is unacceptable.
4. 1. The Company must return to a competitive position which has been eroded by the changes in the retail market, the restrictive practices of the workforce and the more favourable labour costs enjoyed by the competitive companies within the industry.
2. The total investment of £5 million is considerable in an industry which survives on a net margin of 1.5%. In addition the payback period is a minimum of 5 years and the Company therefore cannot proceed without the full agreement and commitment to the plan by all its employees.
3. The rates of pay offered will be the highest in the industry and the offer of compensation is greatly in excess of any other compensation ever paid in the pharmaceutical wholesaling industry.
4. The Company has allowed an extended period of time for these discussions as detailed. However the Company must now implement its plans to redress its competitive position and provide a platform from which Cahill May Roberts may once again provide a return to its shareholder.
The Court having considered all the information before it recommends as follows on the 4 issues presented:-
Company offer on compensation to be amended by increasing the maximum figure from £14,000 to £20,000.
The Company argument that the operation should not be continually disrupted due to people claiming jobs arising due to absenteeism, on a seniority basis, is not unreasonable. The Court recommends that seniority in these cases should only apply in the case of absence of a week or more.
(3)Fork Lift Truck
The Court recommends that the allowances enjoyed by 6 people should be bought out at twice the annual rate and should then be discontinued as part of this overall agreement.
The Court does not recommend any change in the Company's proposals, particularly given that Employees have a choice of method of application.
Signed on behalf of the Labour Court
22nd December, 1997______________________
Enquiries concerning this Recommendation should be addressed to Fran Brennan, Court Secretary.