INDUSTRIAL RELATIONS ACTS, 1946 TO 2001
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
MITSUI DENMAN (IRELAND) LIMITED
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
TECHNICAL, ENGINEERING AND ELECTRICAL UNION
Chairman: Ms Jenkinson
Employer Member: Mr Keogh
Worker Member: Mr. Somers
1. Cost-saving proposals.
2. The Company is involved in the production of manganese dioxide which is the raw material used in the modern alkaline dry cell battery. The plant in Little Island operates a continuous 24 hours, 7 days, 52 weeks per annum. The dispute concerns proposals from the Company to reduce costs in order to ensure its survival. The Unions have accepted that the Company is facing a serious financial situation but they expressed concern at the difficulties they were having in find out the true situation.
The Company first issued a survival plan in January, 2002. In May, 2002, the first of a number of conciliation conferences at the Labour Relations Commission took place. One possibility proposed by the Unions was a form of annualised hours. At the last conciliation conference on the 12th of November, 2002, both sides agreed to recommend proposals from the Industrial Relations Officer (details supplied to the Court) but, in the event, they were rejected by the Unions' members. One issue in contention is the Company's proposal to change the way overtime is calculated. The Unions believe that this could lead to serious losses for the workers.
The dispute was referred to the Labour Court on the 22nd of November, 2002, in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Labour Court hearing took place on the 21st of May, 2003, in Cork, the earliest date suitable to the parties.
3. 1. On examining the Company's financial records it became apparent that the Company paid out dividends well in excess of the profits made for the year in 2001. This had implications for the viability and financial security of the Company.
2. The Unions have acted positively to assist the Company in addressing the financial difficulties it faces. They believe that annualised hours are a way forward.
3. The Company still has to honour an agreement of May, 2000, in relation to the Performance and Quality (PQ) bonus, and there are also payments outstanding under the Programme for Prosperity and Fairness (PPF).
4. 1. All of the product manufactured by the Company is exported. Over the past 3 years there have been changes in the market place e.g. production overcapacity and falling prices. The strong value of the Euro now is another problem. The result was that the Company had to issue a survival plan.
2. The dividends referred to by the Unions are Royalty dividends which have to be paid by the Company. It is not discretionary. There were no dividends paid in 2002/2003.
3. The Company is faced with a number of options e.g. selling the plant, merging the business with another company, radical restructuring or to cease manufacturing. The Company believes that the Industrial Relations Officer's proposals of the 13th of November, 2002, are the best option.
The Court has given careful consideration to the oral and written submissions of the parties, and has had regard to the detailed and extensive negotiations which took place between the parties at the conciliation conferences. The Court notes that the payment terms of the Industrial Relations Officer's proposals of the 18th October, 2002, found acceptance between the parties and have been implemented by the Company.
The Court is gravely concerned in the light of the information supplied by the parties that if arrangements are not put in place to improve the efficiency and cost effectiveness of the firm, the future of the Company and the security of the employment will be put in jeopardy.
The Court notes that the range of options currently under examination by the Board include a proposal for a very radical restructuring of the Company's cost base. The Court notes the Unions' acceptance of the severity of the situation and their acceptance of the Company's need for such radical measures.
The Court recommends that when proposals emerge which will affect the future of the Company or impact on the employment of the workers, these should immediately be brought to the attention of Unions and the workers, and speedy negotiation should take place between the parties. The Court is of the view that if the future of the Company is to be assured, then the necessary organisational changes need to be achieved and success will only result if these changes are achieved with the co-operation of the workforce.
In the meantime, the Court recommends that in order to demonstrate goodwill, to safeguard the future of the Company, and in the interest of preserving jobs, the terms of the proposals set out in the Industrial Relations Officer's letter of the 13th November, 2002, which were recommended by both sides, should now be accepted by the Unions.
Signed on behalf of the Labour Court
5th June, 2003______________________
Enquiries concerning this Recommendation should be addressed to Ciaran O'Neill, Court Secretary.