INDUSTRIAL RELATIONS ACTS, 1946 TO 2001
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
SHANNON AEROSPACE LIMITED
(REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
Chairman: Ms Jenkinson
Employer Member: Mr Carberry
Worker Member: Ms Ni Mhurchu
1. 1-Rostering of working hours
2-New reporting structures
2. The Union has in excess of 400 members in the Company under both varitime and flexitime arrangements. The claim concerns the workers who operate the varitime system.
The Company was established in 1990, and in 1992 it commenced operations in the heavy maintenance of narrow-bodied aircrafts. Each year up to 60 aircrafts undergo extensive overhaul at the Company's facility. There are 5 main issues involved in the dispute:-rostering of staff, new reporting structures, pay/approval pay/sick pay, career progression and extended leave. The Company sees the Union's claim for a 5% pay increase as the main problem. The following are broadly the issues:
The Union is seeking the following: the introduction of a roster that will give an accurate indication of week day and week- end work requirements for any 2 weeks; the standardisation of the working week (39 hours); any change to the 2 weeks' roster to be on a voluntary basis.
Extended leave / annual leave
The Union is seeking a fair and equitable system where overtime hours accumulated both on a rostered and voluntary basis can be taken.
New reporting structure
The Union does not see this as a major issue but the Company is seeking that the workers will report directly to a Head Engineer.
The Union is claiming a 5% increase in basic pay, retrospective to the 1st of January, 2001, in line with flexitime staff.
The Union is seeking approval payments, i.e. payments for workers with qualifications, in line with competitors such as Aer Lingus and FLS.
The Union is seeking the extension of the sick pay scheme for flexitime workers to be extended to varitime workers (details supplied to the Court).
Under the 1996 agreement, a clear career path was established. The path split varitime employees into 2 distant groups - "lines" and "shops". In June, 2001, a new system was introduced which, the Union claims, has changed the requirement for level 2 approval from any one of 4 Basic Aeronautical Engineer Certificates (BAECs) to a full JAR 145 qualification, which is equivalent to 3 BAECs.
The dispute was referred to the Labour Relations Commission and a number of conciliation conferences took place. As the parties did not reach agreement, the dispute was referred to the Labour Court on the 29th of April, 2002, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 10th of July, 2002, in Limerick.
3. 1. The Union is seeking the restoration of parity between flexitime and varitime workers in pay and conditions (inclusive of full retrospection to January, 2001).
2. It is also seeking the application of industry norms in terms of pay scales and approval pay.
3. The workers feel that they should be given some degree of notification in regard to rostering.
4. The introduction of a new work system has robbed members of a career progression path that was put in place in 1996.
4. 1. The downturn in the aviation industry has caused airlines to reduce their demand for aircraft maintenance services. The Company has had to grant price reductions in excess of 10% in order to retain business.
2.If the Company is to remain competitive, cost containment and performance improvement are essential. As such, the Company cannot afford to pay the Union's claim of a 5% increase. An offer was made to the varitime workers in October, 2000 (as well as to the flexitime workers) but was rejected.
3. The Company proposed a progressive Career Progression structure in April, 2002, that continues to provide for rapid advancement.
4. The Company is an excellent employer, something acknowledged by the workers, and has paid all increases due under the Programme for Prosperity and Fairness (PPF). The Union's claims is unrealistic given the Company's circumstances.
In February, 2001, the Company responded to Union claims by putting forward proposals on many items, including increases in basic pay, a new career progression structure, a new reporting structure, the introduction of an approvals payment system for licensed employees and the introduction of competency pay for certain employees. In return, the Company sought concessions on the accumulation of premium hours, changes to the operation of extended leave, introduction of performance related pay system and a new rostering system. The Union members rejected this proposal.
As a result of the events of September 11th, the Company indicated that, due to the uncertainty in the market, the matter was being suspended until January, 2002. The commercial fallout in the global aviation industry meant that the Company could no longer afford to absorb any further cost increases.
Claim for a 5% pay increase and extended salary scales
The Union sought implementation of a 5% pay increase for varitime employees in line with that paid to flexitime employees. The Union maintains that both varitime employees and flexitime employees were always paid the same basic wage and it sought to restore parity, to be given an extension of pay scales to compensate for operating a new work system and to be paid retrospective to January, 2001.
When the Company made an offer to increase the varitime employees pay by 5% as part of the February, 2001 proposals, it was on the basis of seeking concession on a number of issues including the introduction of performance related pay reviews. This was rejected by the Union. This proposals is no longer on offer, therefore, the Court does not recommend concession of this claim. The Company has proposed new approval payments which will provide the potential for enhanced earnings. This proposal is considered below and the Court, therefore, does not recommend concession of an extension of the present salary scales.
The Union sought application of an improved sick pay scheme as it applies to flexitime employees since January, 2001. The Court recommends that on overall acceptance of this recommendation, this scheme should be extended to varitime employees.
Rostering of Staff and New Reporting Structure
The Union pointed out the difficulties experienced by employees due to the variation in the rostering arrangements. This causes personal and social problems for employees. The Company stated that for commercial reasons, and in particular due to the uncertainty in the business, it needs to change rosters, sometimes at short notice.
The Company wishes to introduce a new reporting arrangement whereby varitime employees will report directly to a lead engineer, who will in turn report to the Aircraft Manager. The Union stated that little or no discussion has taken place on this proposal.
The 1996 Varitime Agreement put in place a rostering system designed to balance the peak demands for manpower as dictated by the production requirement and the employees' preferences for flexibility in the times of attendance at work. The system incorporates standard hours, maximum liability hours each day and additional hours on a voluntary basis. It also includes an obligation to work 2 weekends out of 4.
The Court recommends that management should be more definitive in its rostering arrangements and make more of an effort to ensure that employees’ needs are met.
While the agreement provides for “such advance notice as is reasonable in the circumstances”, there clearly is a problem in how this is operating at present. This needs to be clarified for staff and the situation needs a further review to iron out the difficulties. The Court recommends that this should be done in conjunction with staff and incorporating the new reporting structure proposed by management.
The Company wishes to impose a cap on the number of hours which can be put into the extended leave bank, and to pay for such leave instead. The Union is experiencing difficulties in availing of this leave at suitable times and is, therefore, seeking a new system for availing of this time off.
The Court is of the view that the new reporting structure proposed by the Company has the potential to deal with these difficulties. The Court is also of the view that due to the large amount of leave accumulating in this bank, it is reasonable that the Company should impose a cap on the amount of such leave due. Accordingly, the Court recommends that the parties should include this item in their discussions on rostering arrangements/new reporting arrangements with a view to meeting both sides' needs.
Approvals are influenced by European legislation over which the Court has no jurisdiction. The Company offered to increase the Full Approval Allowance in February, 2001 to €1,500 per annum. This represents a substantial improvement on that being paid at the moment (€635 once off). The Company maintains that this offered payment is in excess of payments made in competitor companies.
The Court notes that the Company has offered to pay such payments on a monthly basis for the future, instead of the once-off basis as before.
The Court recommends that the Company’s offer should be accepted.
Other Approval Payments
The Union also sought the introduction of other approval payments for the carrying out of such tasks as aircraft towing, fuel truck driving, forklift driving and a premium payment for fuel tank entry. The Union see these tasks as special tasks whereas the Company see them as an integral part of the job of an Aircraft Maintenance Technician. There is no job description available for the position. The Court has not been furnished with any substantial reasons why these tasks should attach special payments and, therefore, does not concede this part of the claim.
Career Progression/Competency Payments/In-house Payments
The Union is seeking the restoration of the 1996 career structure, particularly for Structures Technicians, who are not covered by the new legal requirements. A new system has been put in place since June, 2001. The old system outlined a clear path and did not impose any restriction on the number of Technicians who could progress to level 2 whereas now the full JAR 145 qualification is required.
One difficulty which has arisen is that the Company has introduced a “by-pass system” for some technicians who have no external qualifications to enable them to be paid competency pay/in-house payments. Other technicians cannot avail of this option. The Union wants all technicians to be able to avail of this “by-pass system”.
The Company maintains that the new proposed career progression plan would provide for rapid advancement and progression. It removes any external qualification barrier for progression to the level of Team Leader. “Effectively, this means that all unlicensed technicians who have never been able to move beyond the top point of Scale C, may now progress into scale D with higher potential earnings”. Furthermore there will be opportunities to progress further.
Under the new legislation governing qualifications of personnel working on aircraft - JAR 66 - there are only two recognised categories of aircraft technician, licensed and unlicensed. The Company has decided to sub-divide the “unlicensed” category to allow for career progression and the granting of in-house approvals with Competency Pay.
In all the circumstances, and with particular regard to the requirements of JAR 145 and the constraints of JAR 66, the Court is satisfied that the 1996 career structure is no longer relevant to meet current Company requirements.
The Company’s proposals relating to career progression for Structures Technicians who are not covered by the legislation requires further discussion and clarification. Therefore, the Court recommends that the parties should have further discussions regarding the application and implementation of career progression; an independent facilitator might assist this process.
Signed on behalf of the Labour Court
26th July, 2002______________________
Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.