INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
IRISH GLASS BOTTLE
(REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
Chairman: Ms Jenkinson
Employer Member: Mr McHenry
Worker Member: Ms Ni Mhurchu
1. Improvement in Company Pension Scheme.
2. The Union has submitted a claim for an improvement in the Company's pension plan. The scheme is non-contributory and was established in 1963. It provides for the following:
(a) A pension of 2/3 of salary after forty years’ service.
(b) Death in service benefits.
(c) Options for dependants pension.
The earnings of the employees are made up of basic pay, bonus and overtime. Bonus earnings however, are not included in calculating pension entitlements which the Union argues should be included. The bonus accounts for thirty per cent of salary.
The Company rejected the Union's claim and states that it is not in a financial position to absorb the additional costs which would be involved by including the bonus in calculating pension entitlements. Management is at present in the process of re-structuring the Company.
As no agreement was possible between the parties the dispute was referred to the Labour Relations Commission. A conciliation conference was held on the 5th of May, 1997 and 26th of June, 1997, but no agreement was reached. The dispute was referred to the Labour
Court on the 11th of August, 1997, under Section 26 (1) of the Industrial Relations Act, 1990. (The Court was subsequently requested by the Union to put this case on "hold"). The Court subsequently investigated the dispute on the 10th of November, 1999.
3. 1. The Union is seeking the inclusion of the bonus payment for calculating pension entitlements.
2. Other staff in the Company have all salary (including overtime) included for pension purposes.
3. The exclusion of bonus payments is contrary to the intent of the provision of pensions which was designed at its outset to provide a reasonable level of income to all employees.
4. The pension scheme as currently operated does not provide an adequate pension when related to earnings after full service.
4. 1. The Company operates in a very competitive market and cannot absorb any further cost increases.
2. The current pension scheme is not out of line with appropriate standards in comparable employments.
3. The Company operates a non-contributory pension scheme. The employees can enhance their pension entitlements by making contributions to the existing "Additional Voluntary Contributions" (AVC) scheme.
4. The claim is a cost increasing one and is precluded under the terms of Partnership 2000.
The Court considered the information submitted by both parties and is of the view that no evidence was presented to substantiate a claim that the pension scheme is out of line with pension schemes generally.
However, taking into account the aspirations of the employees and the fact that discussions are about to commence on a restructuring plan, the Court recommends that these discussions should include the issue of the pension scheme.
Signed on behalf of the Labour Court
29th November, 1999______________________
Enquiries concerning this Recommendation should be addressed to Larry Wisely, Court Secretary.