INDUSTRIAL RELATIONS ACTS, 1946 TO 1990
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
Chairman: Mr Duffy
Employer Member: Mr McHenry
Worker Member: Ms Ni Mhurchu
1. Dates of pay round increases.
2. The Company is part of a multinational group with headquarters in the USA. It manufactures textured yarn in Letterkenny and employs approximately 800 workers. For a number of years the Company negotiated its own agreements and did not participate in national pay agreements. After the Programme For National Recovery the Company did apply national agreements but ended up 28 months behind other employments. The Union claims that the existing wage rates for workers in the Company have fallen behind significantly over recent years and that the applicable dates for increases under the Partnership 2000 and Programme for Prosperity and Fairness agreements are significantly out of line with others locally and nationally. The Union is seeking to have the last phases of P2000 (1.5%+1%) and the first phase of PPF (5.5%) consolidated into one 8% increase to be paid as from the 1st July, 2000 and the remaining two phases of PPF to be paid on the anniversary of that date. The Company rejected the claim. The parties however agreed to enter into a partnership agreement at enterprise level but this would not address the current dispute which was referred to the Labour Relations Commission. Conciliation Conferences were held in November, 2000(2) and January, 2001. Following the second conciliation conference the Company offered to bring forward the PPF 1st and 2nd Phases (5.5 % &5.5%) by six months each, to 1st May, 2001 and 1st May, 2002, and to pay the extra PPF 2% from 1st April, 2001, but the final phase of PCW (1%) and final phase of PPF (4%)
would not be paid, the agreement would expire on the 30th April, 2003, and would be
financed by a reduction of 12 jobs. The Union rejected this offer. At the third
conciliation conference no further progress was made and the dispute was referred to the Labour Court by the Labour Relations Commission on the 9th February, 2001. A Court hearing was held in Bundoran on the 7th March, 2001.
3. 1. The wages of the workers concerned have fallen behind other employments in the area and they are now among the latest starters for the PPF. The workers and the Company are at a considerable disadvantage in terms of retention of staff and morale.
2. The Union has done some research and identified 43 cases where the PPF was paid early. In particular Gwedore Foods, Bunbeg has paid two years early (1st January, 00) and has also paid the last two phases of P2000 on the same date. The Union has also identified 105 cases where increases in excess of the terms of the PPF were paid. Many are subject to the same competitive pressures as UNIFI. In the textile and clothing industry the 5.5% first phase of PPF has been paid from the 1st April, 2000 with the 1.5% and 1% increases under P2000 paid 15 and 6 months earlier respectively. Due to the composition of wages in this industry (low basic and high bonus) employers in the industry will be paying well in excess of the basic terms of the PPF. Under the clothing JCL's a 25% increase (£37) per week was implemented in the first phase alone, and basic rates will rise by 41% over the 33 months of the PPF. Seen in this context the Union's claim is very modest.
3. It is because of its knowledge of the problems in the industry that the Union's claim could be justified. It has deliberately pitched its claim so low.
4. 1. In an effort to compromise, the Company made a significant move to address the Union's claim, despite a poor trading position and a history of accumulated losses. This offer is very reasonable and represents a significant move from the Company's opening position that P2000 should be honoured as signed. The Court is asked to support the Company's offer to bring forward the PPF by six months and reduce the commencement date time lag of any future agreements by 15 months for the following reasons:-
(i). Clause 2 (Annex 1) of the PPF states that except where otherwise agreed at local level, the Agreement shall come into force on the expiry date of Pay Agreements under P2000. In UNIFI's case this was originally 31st October, 2001.
(ii) The Company's workers have received increases over the period of the National Agreements in excess of what they would have obtained under the Agreements.
(iii) When tax relief is taken into account workers have benefited well in excess of inflation rates.
(iv) The Company must improve on its current competitive position if the jobs of the workers are to be safeguarded. Any cost in addition to the terms offered would have serious implications for the Company.
(v) The current plight of the textile industry is well known. In the local area there have been significant job losses in the past two years.
(vi) The Company has provided secure employment since it commenced production in 1976. The current average cost per worker is approximately £20,000 p.a. including employers PRSI and other additional costs and all workers are in a position to maintain a good standard of living.
(vii) The parties have agreed to commence discussions on a Partnership Agreement and if these discussions are successful opportunities to further improve earnings will be discussed and agreed.
(viii) Any move from the terms of the Company's offer would have a knock-on effect to the Company's other workers.
The Court notes that the Company accept the need to restructure the phasing arrangements under National Pay Agreements.
The Court recommends that the parties should now identify and agree further payroll cost saving measures. Contingent on such measures being implemented and sufficient to offset the costs involved, the Company should modify its latest proposals as follows:-
1% final phase of P2000 to be paid with effect from 1st November, 2000.
5.5% PPF first phase to be paid with effect from 1st February, 2001.
5.5% PPF second phase to be paid with effect from 1st March, 2002.
PPF to expire on 30th April, 2003.
The Court so recommends.
Signed on behalf of the Labour Court
23rd March, 2001______________________
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.