INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
WATERFORD CRYSTAL LIMITED
- AND -
AMALGAMATED TRANSPORT AND GENERAL WORKERS' UNION
Chairman: Ms Jenkinson
Employer Member: Mr Keogh
Worker Member: Mr Rorke
1. Industrial Peace/Binding Arbitration.
2. In January, 1993 the Labour Court issued LCR13911 in which it recommended:-
"Having regard to the critical position of the business, the extent
of the present proposals which almost constitute a green-field
situation and the inevitability of some teething difficulties, the
Court considers the undertaking from both Management and
Union, as provided for in Clause 3.3, not to implement any form
of industrial action as both reasonable and prudent. The Court
recommends that the parties should give such an undertaking
but that its duration should be for a period of 3 years."
The parties agreed to extend the duration of the recommendation for a further 3 years with effect from January, 1996.
The industrial peace provision of Clause 3.3 of the 1993 Agreement was one of two key measures which were not agreed as ongoing permanent features. The other key measure was Profit Sharing. The last agreement on Profit Sharing expired on the 31st of December, 1997.
In late 1997, local level discussions took place at which the Company tabled a proposal to extend the industrial peace provisions of Clause 3.3. It argued that industrial peace/binding arbitration is essential to Company profitability and investor confidence and linked the issue to the concession of the 2% under the local bargaining clause of the Programme for Competitiveness and Work and agreement of a new Profit Sharing scheme. Subsequently the Company's offer (details supplied) in return for industrial peace/binding arbitration was rejected by the workers.
The Union's position is that industrial peace/binding arbitration is a stand-alone issue which was agreed in a desperate situation and that the Company is now highly profitable and no longer needs binding arbitration.
The matter was referred to the Labour Relations Commission. A number of conciliation conferences took place but agreement could not be reached and the dispute was referred to the Labour Court on the 27th of November, 1998 under Section 26(1) of the Industrial Relations Act, 1990. Following the last conciliation conference, the Company agreed to revert to local talks on the 2% and the Profit Sharing Scheme. A Labour Court hearing on the issue of industrial peace/binding arbitration took place on the 18th of December, 1998.
3. 1. The workers have implemented all the terms of the 1989, 1990, 1993, and 1994 agreements. Under the 1993 Agreement in particular, the workers suffered dramatic cuts in pay and conditions of employment.
2. It is acknowledged by the Company that without the co-operation of the workers the process of change would not have been implemented as effectively and efficiently as it has been.
3. The Company has come from a position in 1993 of accumulated losses of £95 million, surplus manpower, over capacity, and uncompetitive costs to a situation in 1997 where it recorded an operating profit of £22.1 million. The interim results for the 6 months to June, 1998 show increased sales of Waterford crystal up 26% and operating profits up 36% to £9.1 million and productivity is up by 38%.
4. The workers agreed to industrial peace/binding arbitration at a time when the Company was experiencing difficulties in tackling the problems facing the industry. .
5. The workers are opposed to extending industrial peace/binding arbitration further on the basis that;
- The climate in the Company has changed;
- It is against Union policy;
- It has been abused by certain mangers;
- It is seen as a sanction against the workers.
- The workers are entitled to the same rights as all other workers in the country;
- There is a national debate regarding the issue of industrial peace/binding arbitration and the workers do not wish to influence the debate by creating precedents;
- Industrial peace/binding arbitration is against the partnership model of dealing with disputes set out in Partnership 2000. Clause 8.1 and 8.7 and the Industrial Relations Act, 1990 are adequate to deal with any industrial relations issues.
4. 1. Prior to the agreements of 1990, 1992 and 1993, the industrial relations culture was one of conflict and chaos. Management's efforts to resolve issues procedurally were delayed and frustrated. Industrial action was commonplace. It was a blunt tool which was normally used to resolve issues to the Union's satisfaction and to the detriment of the business.
2. In the five years since the introduction of the industrial peace/binding arbitration (January, 1993) there has been a total of 35 different incidents of unofficial industrial action. While any incident of industrial action is regrettable, management believe that the statistics would be significantly worse but for the existence of the Industrial Peace Agreement. The trend is improving, with less incidents of unofficial action in recent years as people become more accustomed to the provisions of the peace agreement.
3. The workers must support and reinforce the progress which has been made since 1993. In this regard there is a need to develop and nurture this delicate culture of Industrial Peace which provides for peaceful procedural resolution of all issues raised by either party, including acceptance of the decisions by the parties at the end of agreed procedures.
4. The process agreed under Clause 3.3 of the 1993 Agreement is vital to the Company's long term competitiveness. It is a source of competitive advantage and it must remain as one of the key constituents of the Company's unique turnaround. To do otherwise, would undo all the hard work, commitment and sacrifices made by everyone involved and would signal the return to the older failed tactics of industrial relations conflict with its ensuing chaos and negative business consequences.
5. Industrial Peace has yielded the following benefits to-date:
- Investor confidence.
- Secured Investment (over £300 million).
- Protected jobs.
- Uninterrupted product supply to markets.
- Customer confidence.
- Significantly reduced unofficial industrial action.
It is imperative that the process is nurtured and further developed for the future.
6. In 1992, the Company brought forward a composite set of interrelated measures. These measures were the minimum measures necessary to secure the future, for the Company and its employees. These measures are the foundation from which the current and future success emanates.
7. These measures were the results of months of planning and negotiations involving the services of both the Labour Relations Commission and the Labour Court. These changes restored the Company to a more competitive footing and it is now well positioned to develop its competitiveness for the longer term.
8. The Company requests the Court to support its case and to recommend (i) the extension of the Industrial Peace provisions of Clause 3.3 of the 1993 Agreement. and (ii) the maintenance of the link established in 1993 Agreement between the ongoing payment of Profit Sharing and the existence of Industrial Peace.
The Court has given careful consideration to this issue and is conscious of its importance to both sides. In framing this recommendation the Court has taken into account the efforts made by the Union to ensure the stability and rejuvenation of this Company when it went through a critical period in the early '90s. The industrial peace/binding arbitration clauses that they entered into played a crucial part in the ongoing survival and future competitiveness of the Company. It helped the Company gain the support of many new investors which has been so critical. The Company has acknowledged the value of such a clause, however, they maintain that they are not "out of the woods" yet and need the continuation of such an industrial peace clause on a permanent basis.
The Court is of the view that the peace clause has made a significant contribution to the turnaround of the Company. The Court considers this as being entirely consistent with the principles enshrined by Partnership 2000 and believe that it is inappropriate to alter such arrangements during the lifetime of Partnership 2000. Therefore, the Court recommends that the agreement should expire in line with Partnership 2000 as it applies in the Company.
In the intervening time the Court recommends that the parties should meet to agree on a new set of industrial relations procedures designed to deal with arrangements for discussions on major decisions affecting the Company's future.
The Court also recommends that the offer of increased annual leave and an increased compensation formula for established loss of earnings should also be accepted as part of this settlement.
Signed on behalf of the Labour Court
1st February, 1999______________________
Enquiries concerning this Recommendation should be addressed to Fran Brennan, Court Secretary.