INDUSTRIAL RELATIONS ACTS, 1946 TO 2004
SECTION 26(1), INDUSTRIAL RELATIONS ACT, 1990
COMPLETE BAR SOLUTIONS
(REPRESENTED BY THE IRISH BUSINESS AND EMPLOYERS' CONFEDERATION)
- AND -
SERVICES INDUSTRIAL PROFESSIONAL TECHNICAL UNION
Chairman: Ms Jenkinson
Employer Member: Mr Murphy
Worker Member: Ms Ni Mhurchu
1. Claims by the Union in relation to a Pay Increase, Expenses and On-Call Allowance.
2. The Union's claim is for a 5% pay increase in rates of pay and an increase in expenses and On-Call Allowance in respect of workers employed in the Dispense, Service/Relief duties and Stores function. The Company (formerly Celtic Technical ) is wholly involved in the upkeep and maintenance of bar utilities and products (the maintenance and cleaning of beer dispensing taps and equipment). It is one of three companies which provide these services to Guinness Ireland Limited. In March, 2005, the Company successfully tendered for a fixed price three year contract. The Company has implemented a number of redundancies since 2002 due to a downturn in business. In 2004 the parties entered local discussions on the Union's claims which were not successful. The dispute was referred to the Labour Relations Commission. Two Conciliation Conferences were held but agreement was not reached. The dispute was referred to the Labour Court on the 13th July, 2005 in accordance with Section 26(1) of the Industrial Relations Act, 1990. A Court hearing was held on the 10th November, 2005.
3. 1.Pay increase. Prior to the tendering process for the renewal of the contract the Union advised the Company that it would be seeking a 5% pay increase and that this should be factored into the contract. The claimants have cooperated with three redundancy programmes and have given significant productivity with reduced numbers in the employment. The rationalisation has resulted in more driving, more duties and more calls which has put more pressure on workers.
2.Allowances.In relation to the lunch allowance the Union is seeking payment of €15.45 nett. The Telephone Allowance has been withdrawn with reimbursement of expenses over and above a prescribed limit (details set out in Table 1 of the Company's Submission).. The Union is seeking the re-instatement of the allowance. The On-Call Allowance which currently stands at €146 per week on-call should be increased to €300.The other allowances consisting of Stationary and Postage(Incidental), annualised at €300, and Vehicle-Wash, annualised at €420, which have also been withdrawn should be compensated for by the payment of three times the annual loss.
4. 1.Pay increase. The Company could not include a 5% increase in its labour costs when tendering for contract if it wished to remain competitive as other companies were also tendering for the contract. The Company signed a fixed-term contract which incorporates a tight margin and there is little room for manoeuvre. The 5% pay claim alone would cost the Company approximately €148,000 per annum. The expenses sought by the Union would cost €55,000 per annum. Given the nature of the contract the Company could not sustain such excessive costs. It is important to note that one company has gone out of business because these claims could not be met and Complete Bar Solutions has now taken over the business and will find it equally difficult to sustain the Union's claims.
2. The claim is cost-increasing and precluded under the Sustaining Progress Agreement.
3.Allowances.The position in relation to subsistence allowance and expenses is completely outside the Company's control. In a Revenue audit of January, 2005, the Company was found to be non-compliant with regard to the manner in which it provided expenses. Revenue advised the Company that it did not satisfy the requirement for the on-call allowance or the lunch allowance (five miles away from place of work for five hours or more). The Vehicle Wash, Stationary and Postage (Incidental) and Telephone Allowance were no longer permitted unless specifically receipted. The Company has increased the lunch allowance to €15.45 per day which would be tax-free to those workers who qualified for it and agreed to add it on to basic salary for those who did not qualify. The Company also stated that it would gross up the On-Call Allowance to €635 per annum which represents a significant increase to the vast majority of workers and incorporate it into basic pay.
In December, 2004, the Company announced a rationalisation programme which involved the need for a reduction in staff numbers through voluntary redundancy and a change to the journey plans. Previously, in July, 2004, prior to the tendering process with its Client, the Union had submitted a claim which included claims for a 5% increase in pay and a review of expenses and allowances. In the meantime, the Company informed staff that due to Revenue compliance rules it could not continue to pay expenses in the manner in which it had.
Pay Increase of 5%
The Union sought an increase of 5% in pay stating that the rates are out of line with competitors and that extra productivity is being sought as part of the Company's rationalisation plans. The Union contended that changes in working practices sought centre on the proposed new journey plans which involve greater geographical distances for the Dispense and Relief Representatives resulting in an increased number of taps to clean and in the number of outlets to attend involving more driving time and responsibility.
The Company on the other hand maintained that concession of the pay claim would have serious repercussions on its competitiveness and is cost-increasing. It contends that the number of taps to be serviced has reduced significantly over the years and is continuing to decline. It said that the targets set for Service / Relief Representatives are the same as three years ago although the complexity of the role has reduced significantly. The Company told the Court that the primary reason for the rationalisation programme, which gave rise to the change in journey plans, was due to the decline in the number of taps to be serviced.
Having considered the points raised by both parties the Court notes that while conflicting views were presented by both sides on the number of taps serviced there is no change in the working time required of the Representatives and they will continue to be required for no more than 37. 5 hours per week. Additionally, the Company has given a commitment that the proposed changes to journey plans will be drawn up in consultation with staff to ensure they are geographically friendly and has given a commitment that the number of taps to be serviced will continue to be set at an average of not more than 570 per month.
In all these circumstances, the Court does not recommend in favour of the Union's claim for a 5% increase in pay. However, the Court recommends that the situation should be reviewed twelve months following the implementation of the Company's rationalisation programme to measure productivity levels with a view to determining whether there are substantial grounds for concession of an increase in pay at that time.
Review of Expenses and Allowances
On- Call Allowance:-
The Union sought an increase in the On-Call Allowance from €146 to €300 per week on-call. This on-call requirement normally occurs three times per year. The Company included in its offer a proposal to gross up the allowance to approximately €212 per week on-call.
Taking account of the fact that the On Call Allowance has not been reviewed since 2002, the nature of the on-call arrangement and the fact that the allowance has been extended since that time to provide cover not just at weekends and public holidays as in the past but during weekdays as well, therefore, the Court recommends concession of the Union's claim.
Lunch, Telephone, Vehicle Wash and Incidental Allowances:-
In order to address the Union's claim and to comply with Revenue rules, the Company proposed to significantly increase the Lunch Allowance in return for the elimination of Telephone, Vehicle Wash and Incidental Allowances. Its proposal also provided for reimbursement of expenses over and above a prescribed limit (details set out in Table 1 of the Company's Submission). In order to comply with the Revenue rules, the Company introduced this arrangement in May, 2005, on an interim basis pending resolution of all issues in dispute.
The Union sought the re-introduction of the Telephone Allowance with an increase of 6% and sought a buy out of the latter allowances.
Having considered the points raised by both sides on these issues, the Court recommends that the Company's proposal should be formalised and accepted by both parties. In addition, the Court also recommends that a lump sum payment of €400 should be paid to each of the staff concerned as a "buy - in payment" for the new arrangements and in settlement of the Union's claim for a review of these allowances.
The Court recommends that the new journey plans should be finalised as per the Company's commitment mentioned above and the rationalisation plan should be implemented without undue delay.
The Court recommends that the above recommendations should be balloted on and accepted as a package and the €400 lump sum should be paid as soon as possible following such acceptance.
Signed on behalf of the Labour Court
18th November, 2005______________________
Enquiries concerning this Recommendation should be addressed to Tom O'Dea, Court Secretary.