INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
THERMO-KING EUROPE LIMITED
(REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
- AND -
AMALGAMATED ENGINEERING AND ELECTRICAL UNION
Chairman: Mr Flood
Employer Member: Mr McHenry
Worker Member: Mr O'Neill
1. Dispute concerning the Performance Improvement Incentive Scheme.
2. Under the terms of the Company's Performance Improvement Incentive Scheme (details supplied to the Court) a maximum of 4.5% of average basic wage (including shift payment) is available in lump sum format to workers in this scheme. This has been available over the last three years but despite protracted negotiations the parties have failed to reach any formal agreement in respect of it. Some payments were made by the Company to the majority of workers in 1997. The maximum payment was approximately £300. The Union objected to the Company making the payments because no formal agreement existed. The Union's claim relates to the structure of the scheme and the sum of money available. It claims that payments should be based on plant-wide measures of performance and is claiming 6.5% on the basic rate with effect from 1st January, 1997. The Company requires that payments be based on departmental performance stating that this is a more equitable measure of team working than a plant wide system. The 4.5% parameter has been laid down by the parent company and the Company does not intend making any additional payments in respect of 1997. The dispute was referred to the Labour Relations Commission and a conciliation conference was held on the 28th April, 1998. No agreement was reached. The dispute was referred to the Labour Court by the Labour Relations Commission on the 19th May, 1998. A Court hearing was held on the 4th June, 1998.
3. 1. In 1993 the Union agreed to the elimination of the 87.5 B.S.I. performance rating and in return Management was to put in place a new reward structure subject to agreement on the basis of World Class Manufacturing and Gain Sharing. The workers concerned have invested two years of their working life to their commitment to the world class manufacturing negotiations, and seek some recognition of this investment in the form of an enabling payment.
2. The Union is prepared to enter into an agreement on continuous improvement which would be measured on a plant wide basis and monitored by a Joint Steering Committee for reward purposes. This would be subject to continuous improvement being 'fleshed out', (as a term on its own it is too vague), under the headings of productivity, safety, quality and a cost improvement suggestion scheme.
3. The Union claims a levelling up payment to balance out the inequalities created and to recognise the input that the workforce have given since the removal of the cap on production. The amount is 6.5% on the basic rate, backdated to 1st January, 1997.
4. Any agreement must be plant-wide and not linked to individual departments. The structure should not be linked to individual performance in timekeeping and attendance.
4. 1. The Company paid the workers concerned the 3% increase under the special bargaining clause of the Programme for Economic and Social Progress in return for the elimination of the 87.5 cap on production.
2. The Company's scheme is very much in keeping with the spirit of Partnership 2000, Chapter 9. A similar programme has been introduced and is up and running in the Dublin plant since 1997. It is also in operation at the Shannon plant.
3. In 1997 the Company rewarded workers in some departments who have bought into the process. By the end of 1997 almost 300 out of 450 manufacturing workers participated in the scheme and received some form of payment. There are two groups outstanding, still due for payment for their performance in 1997. Payments have been suspended because of the Union's position.
4. Because of the breakdown of negotiations at conciliation the Company offer stands withdrawn. The only possibility now is to look at the scheme going forward from July, 1998.
5. Crucial to the success of this scheme is consistency in its application across the various plants and that it measures both plant and department performance. Similar schemes are already in operation at other Thermo King locations across the country and also with the craftworkers at the Galway plant.
6. The Company wishes to pay the outstanding monies due to the two groups in the plant who participated in the programme up to the end of 1997.
7. The Company's scheme is broadly measured by plant and group department performance. All of the objectives will be measured with payment made on a quarterly basis and the Scheme is conditional on the fact that employees must be at work.
8. The scheme is sanctioned and vetted at Corporation level and there is no question of any retrospection.
The Court is satisfied, based on the information supplied, that payment was made under the national agreement for the removal of the cap.
The Performance Improvement Incentive Scheme is available to employees with a maximum payment of 4.5% on a Department by Department basis. This basis is unacceptable to the employees as is the provision on absenteeism.
Having considered the arguments made the Court recommends as follows:
1. The Company to accept that for year one of the Scheme it be applied on a plant-wide basis.
2. The employees in return to accept that from year two the Scheme, as outlined by the Company, will apply on a departmental basis.
3. The Company to initiate presentations to explain and clarify the Scheme to employees.
Signed on behalf of the Labour Court
19th June, 1998______________________
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.