INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
(REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
- AND -
Chairman: Mr Duffy
Employer Member: Mr Pierce
Worker Member: Mr O'Neill
1. Dispute concerning the introduction of a Christmas bonus.
2. The Company has been trading in the Republic of Ireland since November, 1996 and has eleven stores. It has recently been taken over by Great Universal stores. During negotiations on a procedural agreement which was concluded by the parties in November, 1997 the Union raised the issue of a Christmas bonus claiming that it was part of the standard shop assistant remuneration package and amounted to one to two weeks' pay as a bonus at Christmas. The Company rejected the claim on the grounds that as no such bonus existed in the Company as a whole, it did not intend to introduce a Christmas bonus.
The dispute was referred to the Labour Relations Commission. A conciliation conference was held on the 28th of January, 1999. Agreement was not reached. The dispute was referred to the Labour Court by the Labour Relations Commission on the 20th of April, 1999. A Court hearing was held on the 3rd of June, 1999.
3. 1. While the Company rejected the Union's claim for the payment of a Christmas bonus, during negotiations on the procedural agreement, the Union stated that it would reserve its position with regard to this matter so as that agreement could be reached on other issues.
2. Christmas bonuses are a standard feature of the retail trade in Ireland, and it is normal in that trade for at least one week's pay to be paid prior to Christmas.
3. Partnership 2000 provides for profit sharing and gain sharing arrangements to be negotiated in order to strengthen partnership at the level of enterprise, however, the trend in the retail trade has been for such arrangements to supplement other traditional agreements such as Christmas bonuses. With the advent of Sunday and extended trading agreements have been reached with several major employers for two weeks wages to be paid as Christmas bonus on an on-going basis. Many retail companies pay a minimum of one week's Christmas bonus (details supplied to the Court).
4. Given that retail workers are relatively lower paid the Union has a strong preference for such schemes to continue in order to ensure such workers benefit from increased work and stress at the busiest trading period of the year and to provide for security of income at Christmas.
5. The Bonus Scheme unilaterally introduced by the Company is not due to pay out until March, 2000. This effectively means the workers will have contributed to the success of the business in Ireland for four years without any additional rewards beyond basic pay.
6. The Company should introduce a Christmas bonus scheme of at least one week's wages in line with the established norms within the retail trade, or that in the context of the Company Bonus Scheme the equivalent of one week's wages is deducted form the scheme and paid at Christmas. Amounts in excess of this can be paid in accordance with the new scheme.
4. 1 The payment of Christmas bonus is by no means universal throughout the retail trade. Based upon a cross section of Irish and UK retailers, it is clear that there are some companies who pay a Christmas bonus and many who do not.
2. The Company has as recently as April, 1999 introduced a group bonus scheme which will pay a bonus to employees and is based upon a number of fundamental key principles, namely
(i) the target set will not only be aligned with overall corporate
profitability but with other realistically achievable business
(ii) payments under the scheme will be self funding in terms of
profit growth and,
(iii) any schemes will be competitively positioned against the
market and clearly communicated internally.
3. The terms and conditions of employment that were negotiated and agreed with the Union in November, 1997 and those in existence at the present time, when considered in their totality would place Argos at the forefront of the market. During the course of negotiations and finalising the comprehensive Company/Union agreement, the issue of Christmas bonus was raised, the Company's position at this time was that it did not intend to introduce a bonus at Christmas. Accordingly, the national agreement was signed off on this basis. Had the Union felt at that time that there was an issue in relation to the Christmas bonus, surely the procedural agreement would not have been signed off.
4. The Company has honoured in full, all the terms of Partnership 2000. The claim is cost increasing and is precluded under Partnership 2000.
Having considered the submissions of the parties the Court recommends that the Company introduce a Christmas bonus, equal to one week's pay, with effect from Christmas 1999. Following the introduction of the proposed Company incentive bonus scheme the amount payable by way of Christmas bonus should be off-set against the amount payable under the incentive bonus scheme.
Signed on behalf of the Labour Court
15th June, 1999______________________
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.