INDUSTRIAL RELATIONS ACTS, 1946 TO 2001
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
Chairman: Mr Duffy
Employer Member: Mr Pierce
Worker Member: Mr. Somers
1. Non-payment of additional 2% under the revised terms of the Programme for Prosperity and Fairness (PPF).
2. The issue in dispute is a claim by the Unions for payment of the additional 2% awarded under the revised terms of the Programme for Prosperity and Fairness. The increase was announced on the 4th of December, 2000, to be paid on the 1st of April, 2001.
The Company has refused payment of the 2% on the grounds that it had already paid more. On the 1st of December, 2000, the Company announced a Benefit Package for 2001, which amounted to an average pay increase of 12%, which it claims included 2.5% to cover the PPF increase. The issue was the subject of local discussions and of a conciliation conference under the auspices of the Labour Relations Commission. As agreement was not reached, the issue was referred to the Labour Court on the 1st of May, 2002, in accordance with Section 26(1) of the Industrial Relations Act, 1990. The Court investigated the dispute on the 19th of July, 2002.
3. 1.The increase announced by the Company in December, 2000, was to address the problem of recruiting and retaining staff. The vast majority of retailers also agreed wage increases over and above national agreements.
2. In previous cases the Labour Court has held that it is not whether a PPF plus deal has been concluded, but it is whether the payment of the 2% would put competitiveness and employment at risk. The Company has not demonstrated that this would be the consequence.
3. The Company has not cited economic and commercial difficulties as a reason for non-payment. The retail trade has experienced unparalleled expansion in recent years and can hardly be described as a vulnerable sector.
4. The Company claims that it took into account the likely outcome of the PPF negotiations when considering its Benefit Package. However, it did not state this in correspondence concerning the Unions’ claim, nor was it included in the circular to staff in relation to the new wage rates.
5. The Unions have negotiated payment of the 2% increase on behalf of all their members employed in the retail trade. This Company is the only major retailer not to have conceded payment.
4. 1.The national negotiations on the additional 2% were ongoing at the same time as the Company was considering its pay increases. It explicitly took this into account and included a 2.5% provision in the average rate increase of 12% for 2001.
2.The Company has a proven track record of not only honouring partnership commitments, but exceeding them significantly on many occasions. The PPF, including the supplementary agreement, has required increases totalling 13%. The Company has paid an average of 18.5%.
3.Sales assistants who were earning €5.36 per hour in September, 1999 are now earning
€9.11 per hour. This amounts to a 70% increase in less than three years. In addition, staff benefit from the staff discount scheme which would amount to approximately 4 weeks' extra pay per year for most staff.
4.The Company's current rates are significantly better than those of its main competitors. The cost of a further 2% increase on top of very substantial payments in recent years could not be absorbed by the Company and would inevitably fuel the wage inflation/price inflation spiral that is a major danger for the economy.
Having regard to the terms of the agreement concluded between the parties to PPF on the application of the additional 2% increase, the Court is satisfied that the increase should be paid in this case.
Accordingly, the Court recommends that the Unions' claim be conceded with effect from the 1st of April, 2001.
Signed on behalf of the Labour Court
24th July, 2002______________________
Enquiries concerning this Recommendation should be addressed to Dympna Greene, Court Secretary.