INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
UNIFI TEXTURED YARNS EUROPE LIMITED
- AND -
TECHNICAL, ENGINEERING AND ELECTRICAL UNION
AMALGAMATED ENGINEERING AND ELECTRICAL UNION
Chairman: Ms Owens
Employer Member: Mr Keogh
Worker Member: Mr Rorke
1. (1) Indexation of pensions. (2) Compensation for loss of banking facilities.
2. The Company manufactures polyester filament yarn, mainly for the export market. It employs approximately 780 workers at its plant in Letterkenny. In February, 1995, the Unions submitted a claim for the indexation of pensions on behalf of the maintenance craft workers. The Company rejected the claim. In addition, in January, 1995, Allied Irish Bank informed the Company that it would no longer provide on-site banking facilities for staff with effect from the 30th of March, 1995. The Unions claimed that, as staff had previously been given 15 minutes time off to cash their pay cheques, which was no longer to be given, they should be compensated for the loss of this time off. The issues were discussed at local level and were the subject of a conciliation conference at the Labour Relations Commission on the 25th of February, 1998. As agreement could not be reached the dispute was referred to the Labour Court in accordance with Section 26(1) of the Industrial Relations Act, 1990. The Court investigated the dispute on the 8th of July, 1998, in Letterkenny.
3. 1. Indexation of pensions: A survey carried out in 1996 by the Irish Association of Pension Funds shows that 42% of pension schemes automatically increased, while a further 42% increased at the discretion of the trustees. The Company's pension scheme is, therefore, out of line with the majority of schemes.
2. The Company's contribution to the pension scheme in 1995 was only 3.3% of gross earnings while the majority of employees contributed 6%. The Company has estimated that concession of the Unions' claim would increase its contribution by 46%. This would bring the Company's total contribution to 4.7% of gross earnings which is still relatively low. A normal escalator clause of 3% per annum or C.P.I., whichever is the lower, should be inserted into the superannuation scheme.
3. Banking facilities: Although there is no formal written agreement it became the custom and practice since the 1970's that workers received 15 minutes time off to cash their pay cheques. The Company now benefits from 15 minutes extra production time while the workers must travel a distance to cash their cheques. They should be compensated by way of a lump sum payment as ESB workers were when they lost their on-site banking facility.
4. 1. Indexation of pensions: The current pension scheme provides benefits well in excess of those provided in comparable employments. A survey carried out in 1997 by I.B.E.C. found that only 39% of companies operating in the textile industry provided pension arrangements for their manual employees and only 55% of companies operating in the North West did so.
2. The Company's pension scheme provides benefits based on gross earnings which includes basic pay, overtime, shift premium, holiday pay and all other taxable earnings. This considerably increases the amount of pension paid at retirement. The Unions' claim is outside the scope of what was intended in Clause 4 of PESP and Partnership 2000.
3. Banking facilities: The closure of the bank sub-office was outside the control of the Company. The bank provided a very generous financial package to those who availed of the Paypath system. There was never any agreed time allocated to go to the bank which was situated en route to the canteen. The majority of the Company's employees have accepted the reasons for the closure and are happy with the arrangements now in place. Only a small number of employees who live outside of the Republic of Ireland have experienced difficulties.
Indexation of pensions:
Having considered the submissions and the arguments made, the Court has come to the view that there is some merit in the Unions' claim and, accordingly, recommends that the parties meet and review the position on the expiry of Partnership 2000.
Taking into account the length of time that has elapsed since the change in banking facilities, and recognising that there was no fixed period actually allowed for cheque cashing, the Court finds that the Unions' claim is not well founded. The Court, however, recommends that individuals who may have particular difficulties (referred to at the hearing) should be given sympathetic consideration.
Signed on behalf of the Labour Court
4th August, 1998______________________
Enquiries concerning this Recommendation should be addressed to Dympna Greene, Court Secretary.