INDUSTRIAL RELATIONS ACTS, 1946 TO 2004
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
(REPRESENTED BY IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
Chairman: Mr McGee
Employer Member: Mr Doherty
Worker Member: Ms Ni Mhurchu
1. Company seeking cost off-setting measures under clause 1.10 (iii) of the Sustaining Progress Agreement.
2. The dispute concerns the Company's proposal to seek cost off-setting measures in the form of lean manufacturing in return for payment of the pay terms of the Sustaining Progress Agreement (SP). The Union sought the payment without cost off-setting measures. Local discussions were not successful. The dispute was referred to the Labour Relations Commission. A number of conciliation conferences were held in 2003 and 2004 during which the parties agreed to the appointment of an Independent Assessor from IPC. His report was issued in February, 2004. A final conciliation conference was held in April, 2004 to discuss the IPC report. The parties agreed to recommend for acceptance a proposal of the Industrial Relations Officer which provided for the establishment of a Joint Steering Group (JSG) with IPC as independent chair and phasing arrangements for the payment of the terms of SP. The proposal was rejected following a ballot of the workforce. The dispute was referred to the Labour Court on the 12th July, 2004 in accordance with Section 26 (1) of the Industrial Relations Act, 1990. A Court hearing was held on the 20th October, 2004.
3. 1. The workers concerned have given considerable cooperation with various changes in working practices over the years. The Union is prepared to enter discussions on further productivity and the establishment of the JSG but the Company must first pay the terms of Sustaining Progress to workers. Their pay rates are relatively modest and they have not received a pay increase for two years.
2. The Company outlined to the Union in 2003 that it was not losing money. That being the case the Union believes that the Company should pay the terms of SP.
3. As significant savings were made as a result of the restructuring of Management in 2003, which has meant ongoing change for workers, there is no good reason for withholding the increases due.
4. 1. The Company has undergone difficult trading conditions in recent years. The Company found itself in a precarious position with the only tenable option being a new way of doing business. The Independent Assessor upheld the principle of pleading inability to pay without cost off-setting measures.
2. The IRO proposal, whilst appropriate to the circumstances in April, 2004 needs to reflect the business going forward. Although it is imperative that new processes are found in return for paying the terms of SP, the lapse of time since IPC suggestions on lean manufacturing mean that they are no longer directly applicable.
3. The Company contends that the JSG should be established to look at new processes and that the pay terms of the proposal should not have an arrears component.
The Court has considered the respective submissions of both parties and has carefully given consideration to the issues involved.
The Court finds it is reasonable in the current trading circumstances, for the Company to negotiate and look for cost off setting measures in the context of the Sustaining Progress Agreement and the payment of the increases involved.
The Court further recommends the parties accept the commissioned Assessor's Report and establish the Joint Steering Group as envisaged and appoint an Independent Chairman, such as IPC, to facilitate the work of this group with a view to introducing the necessary cost offsetting measures.
The Court recommends that pay increases should accompany this development process as follows:
1. Implement the combined increases of 7% under Sustaining Progress from 1st September, 2004
2. Implement the retrospective element of the 2% increase (phase 2 of SP) on 1st December, 2004 to have effect from 1st March, 2004 -- 6 months retrospection.
3. Implement the retrospective element of the 3% increase (phase 1 of SP) on 1st April, 2005 to have effect from 1st January, 2004--9 months retrospection.
4. Implement the balance of retrospection for phase 1 of SP (3%) with effect from 1st July, 2003 ---final 6 months retrospection, on the successful completion of the JSG work in identifying and implementing all the necessary cost offsetting measures required to enable the full payment of the SP increases.
The Court additionally recommends that the timetable suggested in the Assessor's Report should be adopted and adhered to by the parties in establishing and carrying out the work and function of the JSG.
Signed on behalf of the Labour Court
12th November, 2004______________________
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.