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 Grier
Worker Member: Mr. Somers
1. Sustaining Progress.
2. The dispute relates to the Company's claim of inability to pay the terms of the Sustaining Progress (SP) Agreement under Clause 1.10 of the Agreement. The Union claimed that the terms of SP should be paid with effect from January, 2003. The dispute was referred to the Labour Relations Commission and following an initial conciliation conference the parties agreed to an Independent Assessor from IPC to review the Company's claim. The Assessor's report was published in February, 2004. At a resumed conciliation conference in April, 2004 the Company reiterated its claim of inability to pay the terms of SP. The dispute was referred to the Labour Court on the 10th August, 2004 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Court hearing was held in Galway on the 3rd November, 2004.
3. 1. The Union was unhappy with the contents of the Assessor's report. It was carried out on the basis of Management accounts only which are based on the word of the Company. They do not constitute verifiable evidence that could be used to justify non payment of the terms of the SP Agreement.
2. Despite requests, the Union was not provided with information on the Company's financial position.
3. Detail was not provided on how the Assessor verified the Company claims relating to the economic environment.
4. The Assessor declined to engage with the Union in discussing and elaborating on his report.
5. The rate of pay obtaining in the Company is extremely low. Workers are aggrieved that they have not received a pay increase since April, 2002.
6. As there are only a small number of workers involved, concession of the claim would not involve a significant cost to the Company.
4. 1. The Company has suffered a significant downturn in its business since 2001. The Assessor's report confirms that the Company has a valid claim of inability to pay the increases due under the terms of the SP Agreement. The report stated that the payment of the claim would lead to an increase in operating losses and restrict the Company's ability to compete and survive in an extremely difficult market.
2. The new owner of the Company (since June, 2004), as the sole shareholder, has had to borrow a significant amount from the bank for the Company and also loaned the Company a further substantial amount. It is his belief that the Company will come back to profitability within the next twelve months.
3. The Company has supplied all the information requested of it by the Assessor and has fully complied with Section 1.10 (i) (ii) of the SP Agreement.
Under Clause 1.10 (ii) of the pay provisions of "Sustaining Progress", the Court must confine itself to deciding whether or not the Employer can or cannot pay the terms set out in the Agreement, taking into account the report of the agreed Independent Assessor, the Court finds that, at this time, the Company cannot pay the provisions of "Sustaining Progress" and recommends accordingly.
The Court, however, notes the hopes expressed by the Company that its financial situation will shortly improve and would encourage the parties, with the help, if necessary, of the conciliation service of the LRC and /or the Court, to further examine the situation in the course of 2005.
Signed on behalf of the Labour Court
8th February, 2005______________________
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.